Electrical Machinery

  • The Indian electrical equipment industry comprises of two broad segments – 1
    • Generation equipment (boilers, turbines, generators)
    • Transmission & Distribution (T&D) and allied equipment like transformers, cables, transmission lines, etc
  • India’s target is to increase electronics manufacturing capability to INR 24 Lakh cr by 2025-2026 and help create more than 10 lakh jobs. *
Reasons to Invest
  • Incentives for capacity addition in power generation will further increase the demand for electrical machinery. 
  • Indian manufacturers are becoming more competitive in terms of product designs, manufacturing and testing facilities.
  • Capacity creation in sectors such as infrastructure, power, mining, oil and gas, refinery, steel, automotive and consumer durables are driving demand in the engineering sector. 
  • Rapid increase in infrastructure investments and industrial production will fuel further growth.
Recent Announcements

21st July 2023:  A total of 8,738 Public Charging Stations operational in the country.

Ministry of Heavy Industries


16th June 2023: Union Minister of Heavy Industries Dr.Mahendra Nath Pandey Launches "Dugdh Sankalan Sathi Mobile App" to Transform Indian Dairy Industries.

Ministry of Heavy Industries


15th June 2023: PLI scheme will generate 1.48 lakh jobs in five years: Dr. Mahendra Nath Pandey.

Ministry of Heavy Industries


15th June 2022: 27 projects worth Rs 909.38 crore approved under Phase-I of the Scheme for Enhancement of Competitiveness in Indian Capital Goods

Ministry of Heavy Industries

  • Average Index of Industrial Production of manufacture of electrical equipment in June 2023 is 103.7 *
  • Average Index of Industrial Production of machinery and equipment in June 2023 is 121.9. *
  • Average Index of Industrial Production of manufacture of computer, electronic and optical products in June 2023 is 122.8. *
Growth Drivers
  • Ministry of Heavy Industries (MHI) and Ministry of Skill Development and Entrepreneurship (MSDE) sign MoU to facilitate training in engineering trades to boost capital goods sector.*
  • Three Companies signed Program Agreement under (PLI) Scheme for Advanced Chemistry Cell (ACC) Battery Storage.*
FDI Policy
  • 100% FDI is allowed under the automatic route in the electrical machinery sector, subject to all applicable regulations and laws. *
  • The cumulative FDI equity inflow in the Electrical Equipment industry is USD 11.59 bn during the period April 2000 to March 2023. This constitutes 1.82% of the total FDI inflow received across sectors.*
  • The cumulative FDI equity inflow in the Industrial Machinery is USD 6.45 bn during the period April 2000 to March 2023. *
  • The cumulative FDI equity inflow in the Machine Tools is USD 1.07 bn during the period April 2000 to March 2023. *
Production Linked Incentive (PLI) Scheme

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has given its approval to introduce the Production-Linked Incentive (PLI) Schemes for Large Scale Electronics Manufacturing and IT Hardware for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat.

  1. Production Linked Incentive Scheme (PLI) for Large Scale Electronics Manufacturing, Gazette of India
  2. Production Linked Incentive Scheme (PLI) for IT Hardware, Gazette of India

Financial Outlay-

  1. INR 40,000 cr
  2. INR 7,325 cr

Products: Laptops, Mobile Phones, Specified Electronic Components, Tablets, All in one PCs & Servers.

For more details on PLI Schemes, Click Here

Sector Policy


The electrical machinery industry has been de-licensed, along with 100% FDI allowed in this sector. This has facilitated the entry of major global players into the electrical machinery industry in India.


To make India a preferred country for the production of electrical equipment. It also aims to achieve a production target of USD 100 Bn by balancing the trade deficit.

Areas of focus include:

  • Technology and R&D
  • Lowering of customs duties on a range of equipment
  • Setting up of the Electrical Equipment Skill Development Council (EESDC)
  • Establishment of electrical equipment industry clusters
  • Enhancement of product-testing infrastructure in the country
  • Provide credit support to economically less-developed export markets.

Scheme on Enhancement of Competitiveness in the Indian Capital Goods Sector- Phase-II *

  • The Scheme provides assistance to Common Technology Development and Services Infrastructure has a financial outlay of INR 1207 crores with Budgetary support of INR 975 crore and Industry Contribution of INR 232 crore to expand and enlarge the impact created by Phase I of Capital Goods scheme, thereby providing greater impetus through the creation of a strong and globally competitive capital goods sector.
  • 8 Centres of Excellence (CoEs) established in Phase -I of the Scheme for Enhancement of Competitiveness in the Indian Capital Goods Sector.
  • 2 Centres of Excellence (CoEs) sanctioned in Phase -II of the Scheme for Enhancement of Competitiveness in the Indian Capital Goods Sector.
Financial Support


Apart from the above, each state in India offers additional incentives for industrial projects. Incentives are in areas like subsidized land cost, relaxation in stamp duty, exemption on the sale/lease of land, patent subsidy, power tariff incentives, a concessional rate of interest on loans, investment subsidies/tax incentives, backward areas subsidies, special incentive packages for mega projects, etc.


Various incentives are provided under Export Promotion Capital Goods scheme, Duty Remission scheme, Focus Product scheme, Special Focus Product scheme, Focus Market scheme.


Steps taken for Skill Development, such as setting up of Electrical Equipment Skill Development Council (EESDC), would help to bridge the skill gap required for critical manufacturing. It has a clear objective to enhance exports.


The government approved 15 SEZs for the engineering sector, and electrical machinery is a part of the sector. Further, development of Delhi –Mumbai Industrial sector is expected to provide a big boost to the engineering sector.

Investment Opportunities
  • Generation Equipment: Boilers, Turbines, Generators
  • Transmission Equipment: Transformers
  • Distribution Equipment: Switch Gears, Controls
  • Others: Electrical Motors, Wires and Cables
Sector Reports
  1. Year End Review 2022: Ministry of Electronics and Information Technology (MeitY)
  2. Year End Review 2022: Ministry of Heavy Industries
Foreign Investors
  • MHI (Japan)
  • Hitachi (Japan)
  • Babcock (UK)
  • Alstom (France)
  • Toshiba (Japan)
  • Ansaldo (Italy)
  • Colfax Corporation (USA)
  • Schneider Electric (France)
  • Legrand (France)
  • GE (USA)
  1. “Industry Intelligence - Indian Engineering”, Indian Electrical & Electronics Manufacturers’ Association (IEEMA)
  2. “Fact Sheet On Foreign Direct Investment (FDI) From April, 2000 To December, 2019”, Department for Promotion of Industry and Industrial Trade, https://dipp.gov.in/sites/default/files/FDI_Factsheet_December-19_5March2020.pdf
  3. Consolidated FDI Policy, https://invest-india-revamp-static-files.s3.ap-south-1.amazonaws.com/2020-04/FDI%20Policy%202019%20revised_19%20April%202020.pdf
  4. Factsheet on FDI - April 2000 to March 2022Department for Promotion of Industry and Internal Trade, https://dpiit.gov.in/sites/default/files/FDI_Factsheet_March_2022_23May2022.pdf

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