सामग्री पर जाएं

Equity Effects of PLI Semiconductor Incentives and Domestic Supplier Upgrading

State-driven industrial support mechanisms in high-technology sectors often generate structural disparities between lead assemblers and upstream component manufacturers. The alignment of output-linked capital subsidies with targeted capability development determines whether domestic supplier upgrading and equitable value capture can be achieved. Systematic policy rebalancing towards domestic supplier ecosystems remains essential for sustainable value chain integration.

दस्तावेज़ विवरण

यह एक संक्षिप्त विवरण (preview) है। पूर्ण संस्करण में सभी अनुभागों के लिए विस्तृत टेक्स्ट, एक निष्कर्ष और एक व्यवस्थित ग्रंथ सूची शामिल है।

Bachelor's Project

Degree:
Equity Effects of PLI Semiconductor Incentives and Domestic Supplier Upgrading

Author:

Group

First M. Last

Advisor:

Dr. First Last

City, 2026

Contents

Introduction
1. Theoretical Foundations of Industrial Policy and Supplier Linkages
1.1 Global Value Chain Participation and Domestic Value Capture
1.3 Inter-Firm Linkages and Technology Spillovers in High-Technology Ecosystems
2. Methodological Framework for Evaluating Semiconductor Incentive Structures
2.1 Comparative Policy Analysis and Secondary Evaluation Criteria
2.2 Measuring Domestic Value Addition and Component Sourcing Depth
2.3 Equity Metrics across Large Integrators and Domestic Component Suppliers
3. Analytical Evaluation of the Production Linked Incentive Scheme
3.1 Concentration of Capital Subsidies in Assembly versus Component Upgrading
3.2 Structural Constraints Faced by Domestic Micro, Small, and Medium Suppliers
3.3 Integration Patterns within the Indian Semiconductor Manufacturing Order
4. Policy Implications for Broad-Based Technological Upgrading
4.1 Recalibrating Fiscal Incentives toward Upstream Domestic R&D and Tooling
4.2 Institutional Mechanisms for Facilitating Technology Transfer and MSME Integration
Conclusion
Bibliography

Introduction

Targeted industrial subsidies serve as critical instruments for nations seeking integration into high-technology manufacturing networks. In India, the Production Linked Incentive framework seeks to reduce import dependence and expand domestic electronics and semiconductor manufacturing [2]. While these policy mechanisms stimulate private capital expenditure and aggregate output, the distribution of economic benefits across value-chain tiers raises fundamental questions regarding structural equity and long-term domestic capacity development [4]. Industrial policy in the semiconductor sector operates under intense capital concentration, creating a divergence between lead manufacturing firms and domestic component suppliers. Subsidies geared strictly towards incremental sales and assembly expansion often fail to cultivate local upstream ecosystems, thereby limiting technology transfer and domestic value capture [1]. Without targeted mechanisms for tier-two and tier-three suppliers, state support risks deepening reliance on imported inputs rather than fostering resilient domestic supplier networks [8]. This study investigates the equity effects of production-linked incentives on domestic supplier upgrading in India's semiconductor manufacturing ecosystem. Utilising comparative policy analysis and secondary evaluative frameworks, the research assesses the institutional barriers hindering micro, small, and medium supplier participation. The findings provide strategic insights into redesigning industrial incentives to foster equitable technology transfer, local component capabilities, and sustainable industrialisation.

3.1 Concentration of Capital Subsidies in Assembly versus Component Upgrading

The structural architecture of the Production Linked Incentive scheme conditions the distribution of gains across tiers of the semiconductor and electronics supply chain. By tying financial incentives directly to incremental sales of manufactured goods over a specified base year, the state policy framework primarily stimulates top-line capacity expansion, employment generation, and private capital investments among large-scale integrators (SSRN, 2025). This operational design reinforces the competitive positioning of high-volume manufacturing entities in global markets, yet it simultaneously creates distributional asymmetries between lead assemblers and upstream component suppliers. An analytical evaluation of global value chain integration demonstrates that while incentive disbursement strengthens aggregate manufacturing volumes and export performance in high-technology segments, domestic value capture remains constrained when state support emphasizes pure output metrics rather than local capability development (SSRN, 2026). Upstream micro, small, and medium enterprises encounter persistent structural barriers within this framework, including limited access to systematic technology transfer and the capital-intensive infrastructure necessary for advanced precision component fabrication. Consequently, assembly-oriented activities capture the preponderance of public fiscal support, whereas domestic supplier ecosystems experience sluggish technological upgrading and weak inter-firm integration. Addressing these structural equity imbalances requires recalibrating industrial mechanisms toward domestic research, design, and supplier tooling capabilities. Without targeted policy interventions that facilitate technology diffusion, domestic supplier participation, and deep industrial linkages, output-based subsidy regimes risk entrenching reliance on imported inputs while limiting broader technological upgrading across the domestic manufacturing base.

References

  1. Industrial Policy and Global Value Chains in India: Evaluating the Impact of PLI on Domestic Value Addition, Export Upgrading and Supplier Linkages
    CHETAN SINGH CHOUHAN
    DOI लिंक
  2. AN OVERVIEW ON PRODUCTION LINKED INCENTIVE (PLI) SCHEME BY THE GOVERNMENT OF INDIA
    Rajesh Timane
    DOI लिंक
  3. A Comprehensive Study of Production-Linked Incentive (PLI) Scheme, as a Catalyst for Indian Economy
    Anil Kumar Sharma Renu
    DOI लिंक
  4. Impact of the Production Linked Incentive Schemes by the government of India on the growth of the manufacturing sector
    Aditya Gaurav Karnik
  5. Do Government Incentive Schemes Affect Stock Prices? Evidence from the Production Linked Incentive Scheme in India
    Rahul Anand Research Scholar, P.G. Deptt. Of Commerce, M.U. Bodh Gaya Gayaji, Bihar
  6. PRODUCTS LINKED INCENTIVE (PLI) SCHEME: A BLUEPRINT FOR INDIA’S NEW GLOBAL MANUFACTURING ORDER
    Kriti Swami
  7. Teaching Case Study of PLI Auto Scheme Incentive to Ola Electric: For Sustainable Entrepreneurship
    Mahesh K. M., P. S. Aithal, Lakshman K. et al.
  8. India's evolving role in global supply chains
    Vidhate, Mahesh Eknath, Vidhate, H.G.

संदर्भ सूची

सत्यापित स्रोतफॉर्मेटिंग मानकउच्च मौलिकताप्रो मॉडल्स
Launch Offer -25%

डिप्लोमा

APA 7th Edition

₹1,200₹1,599
  • 60-80 पृष्ठ
  • उच्च मौलिकता
  • वर्ड में निर्यात करें
  • सही फ़ॉर्मेटिंग
  • सार्वजनिक पूर्वावलोकन
    किसी अन्य लेखक के पूर्वावलोकन को निजी नहीं बनाया जा सकता है। आपका कार्य निजी रहेगा और पूरी तरह से अद्वितीय होगा।
  • ग्रंथ सूची (20+, APA 7th Edition)
    +₹100
  • वैकल्पिक स्रोत जोड़ें (समाचार, .gov, .edu)

डिप्लोमा

APA 7th Edition