PLI-Backed Production Aims to Double Output, Strengthen India’s IT Hardware Ecosystem.
New Delhi– HP India is set to commence local manufacturing of laptops, desktops and all-in-one PCs starting May 2024 through a strategic partnership with Dixon Technologies. This move aligns with India’s PLI scheme for IT hardware and signals HP’s commitment to scaling up domestic production amid global supply chain shifts.
Key Highlights of HP-Dixon Partnership
✅ Production starts May 2024 at Dixon’s facilities
✅ Target: Double last year’s output (pre-PLI volumes)
✅ Products: Consumer & commercial laptops, desktops, AIOs
✅ PLI beneficiary: Among 27 firms approved under ₹17,000cr IT hardware scheme
Strategic Drivers Behind Localization
🔹 PLI Incentives: Capitalize on government subsidies for local manufacturing
🔹 Import Substitution: Reduce reliance on China amid US-China trade tensions
🔹 Growing Demand:
- Commercial segment: Enterprises, IT/ITeS, MSMEs
- Consumer segment: Gaming, education, content creation
🔹 Supply Chain Resilience: Hedge against potential US tariffs on Chinese electronics
HP India’s Growth Strategy
Ipsita Dasgupta, SVP & MD, HP India:
*“Our India vision predates China+1. We’ll keep increasing local production share annually.”*
Key Initiatives:
- HP Connects: MSME-focused tech hubs offering IT consulting
- Gaming & Edu Focus: High-performance laptops for creators/students
- Exploring Component PLI: Evaluating ₹23,000cr scheme for deeper localization
India’s IT Hardware Manufacturing Landscape
📊 Current Market (FY24):
- Imports: $11 billion (laptops/PCs)
- Local Production: ~$1 billion (10-20% of demand)
🚀 Future Potential:
- PLI Boost: 40+ companies now showing interest (vs. slow initial uptake)
- Procurement Advantage: Govt tenders require 20-50% local content
- Export Hub: Global brands diversifying from China
Challenges Ahead
⚠️ Limited Local Value Addition: Most components still imported
⚠️ Scale Gap: Need faster capacity ramp-up to replace imports
⚠️ Global Competition: Vietnam, Mexico also attracting supply chains
Why This Matters?
- Job Creation: Skilled roles in assembly, testing, R&D
- Tech Self-Reliance: Reduces import dependence in critical IT infrastructure
- Investor Signal: Global brands following HP-Dell-Apple’s India push
Next Steps:
- Monitor HP-Dixon’s May production launch
- Watch for component-maker partnerships under new PLI