Centre Greenlights ₹1,012 Crore Investment for Electronics Clusters in Tamil Nadu

Chennai, India Jul 23, 2026 ALN: The Centre has approved two Electronics Manufacturing Clusters (EMCs) in Tamil Nadu with a combined investment of over ₹1,012 crore, aiming to strengthen the state’s electronics manufacturing ecosystem and further India’s push towards self-reliance in the sector. The announcement was made by Union Minister for Electronics and Information Technology Ashwini Vaishnaw in a written reply in the Lok Sabha on Wednesday.

The two clusters will be developed at Manallur and Pillapaikkam. The Manallur EMC will span 474.3 acres with a project cost of ₹587.47 crore, while the Pillapaikkam EMC will cover 379.3 acres at an investment of ₹424.55 crore. Together, the projects are expected to enhance electronics manufacturing capacity and attract further investments to the state. The establishment of these clusters is part of a broader strategy to position India as a global manufacturing hub for electronics, particularly in light of the increasing demand for electronic goods both domestically and internationally.

The government stated that India’s electronics manufacturing sector has witnessed significant growth over the past decade, supported by reforms such as Production Linked Incentive (PLI) schemes, liberalised FDI norms, tax reforms, and labour reforms. Electronics production has increased from nearly ₹1.9 lakh crore in 2014-15 to around ₹13.11 lakh crore in 2025-26, while exports have risen from about ₹38,000 crore to ₹4.24 lakh crore during the same period. Mobile phone production has grown more than thirty-fold to ₹6.27 lakh crore, with exports touching ₹2.59 lakh crore. India now manufactures nearly 99.2 percent of the mobile phones sold domestically, and the sector provides employment to nearly 25 lakh people, according to industry estimates. This growth trajectory indicates a significant shift in India’s role in the global electronics supply chain, moving from a largely consumption-driven market to a substantial player in manufacturing.

Tamil Nadu has emerged as one of the country’s key electronics manufacturing hubs, with manufacturing facilities spread across districts including Kancheepuram, Chennai, Chengalpattu, Krishnagiri, Tiruvallur, and Coimbatore. The state's strategic location, skilled workforce, and supportive government policies have contributed to its growth as a manufacturing powerhouse. Major global companies have set up operations in Tamil Nadu, taking advantage of the state’s infrastructure and talent pool. This has not only boosted the local economy but has also provided numerous job opportunities, enhancing the standard of living for many residents.

Highlighting progress under the Semicon India Programme, the government mentioned that it has approved 12 semiconductor manufacturing projects across six states with investment commitments of about ₹1.64 lakh crore, of which three have already commenced commercial production. The programme also supports semiconductor design through the Design Linked Incentive (DLI) Scheme, under which 24 semiconductor design projects and 105 startups and MSMEs have received financial or Electronic Design Automation (EDA) tool support. Several Chennai-based companies, along with a Coimbatore-based firm, are among the beneficiaries. The semiconductor industry is critical for the electronics sector, as semiconductors are essential components in a wide range of electronic devices, from smartphones to automobiles. The development of a robust semiconductor ecosystem in India is crucial for reducing dependence on imports and ensuring supply chain resilience.

To build a skilled semiconductor workforce, the government is supporting talent development in 315 institutions across the country, including 61 institutes in Tamil Nadu. These include premier institutions such as IIT Madras, NIT Tiruchirappalli, IIITDM Kancheepuram, VIT, Anna University, and several engineering colleges across the state. By investing in education and training, the government aims to equip the next generation of engineers and technicians with the skills necessary to thrive in the rapidly evolving electronics and semiconductor industries. This focus on skill development is vital for sustaining growth in the sector and ensuring that India can compete on a global scale.

The government also noted that the recently approved Semicon 2.0 programme expands support across the semiconductor value chain, creating additional investment opportunities for all states, including Tamil Nadu. This initiative is expected to further boost the semiconductor industry by providing incentives for companies to invest in manufacturing, research and development, and innovation. By fostering a comprehensive semiconductor ecosystem, the government aims to position India as a leader in this critical technology area.

On artificial intelligence, the Centre stated that the IndiaAI Mission is supporting indigenous AI innovation through seven focus areas, including AI models, applications, datasets, talent development, and affordable computing infrastructure. So far, 20 sovereign AI model proposals—comprising 12 Large Language Models (LLMs) and eight Small Language Models (SLMs)—have been identified for government support. Two Artificial Intelligence Centres of Excellence have also been approved for Tamil Nadu. These centres are expected to drive research and development in AI, promote collaboration between academia and industry, and foster innovation in various sectors, including healthcare, agriculture, and manufacturing.

The government further highlighted the role of Common Services Centres (CSCs) in promoting digital inclusion. As of May 31, 2026, Tamil Nadu has 18,632 functional CSCs, including 12,379 operating in rural areas, delivering more than 800 citizen-centric services. These centres play a crucial role in bridging the digital divide by providing access to information and services in remote and underserved areas. By enhancing digital literacy and access to technology, CSCs contribute to the overall development of communities and empower citizens to participate in the digital economy.

The establishment of the Electronics Manufacturing Clusters in Tamil Nadu aligns with the government's broader vision of promoting Make in India, a flagship initiative aimed at transforming India into a global manufacturing hub. The initiative encourages both domestic and foreign companies to manufacture products in India, thereby creating jobs, boosting economic growth, and enhancing the country’s manufacturing capabilities. The successful implementation of these clusters could serve as a model for other states looking to develop their own manufacturing ecosystems.

In conclusion, the approval of the Electronics Manufacturing Clusters in Tamil Nadu represents a significant step towards enhancing the state’s manufacturing capabilities and contributing to India’s goal of self-reliance in electronics. As the country continues to invest in infrastructure, skill development, and innovation, the potential for growth in the electronics sector remains substantial. The government’s proactive approach in supporting various initiatives, including semiconductor manufacturing and artificial intelligence, underscores its commitment to fostering a robust and competitive electronics ecosystem that can meet the demands of the future.