The Government of Haryana has adopted a proactive approach to developing a vibrant Electronics System Design & Manufacturing ecosystem through successive policy initiatives. Building on the foundations of the IT & ESDM Policy, 2017, and the Haryana ESDM Policy, 2024, the State’s 2025–26 policy vision seeks to attract investment, strengthen manufacturing capabilities, and create a globally competitive electronics sector. Supported by strong infrastructure and a skilled workforce, Haryana is well-positioned to emerge as a key player in India’s electronics growth story.
Background: Why ESDM Matters
The Electronics System Design and Manufacturing (ESDM) sector has emerged as one of the most critical industries driving technological advancement and economic growth in the 21st century. It spans a vast spectrum — from semiconductor chips and printed circuit boards to consumer electronics, telecommunications equipment, medical devices, defence electronics, and industrial automation systems.
The global ESDM market was valued at approximately USD 1.7 trillion in 2021, with India’s domestic electronics demand reaching USD 330 billion in FY2020 and projected to climb toward USD 400 billion by FY2025. Despite being a large consumer, India’s share in global hardware electronics production has historically hovered around 3%, making domestic manufacturing policy all the more critical.
At the state level, Haryana has long been an important player. The IT and ESDM sector together contribute close to 10% of the state’s GDP and account for 54% of Haryana’s exports, providing direct and indirect employment to over 10 lakh people. Gurugram, in particular, has emerged as a premier global Business Process Management (BPM) hub, with the city alone accounting for 5% of worldwide BPM employees.
Policy Evolution: From 2017 to 2025
IT & ESDM Policy 2017:
The 2017 policy laid the groundwork for Haryana’s electronics ambitions. It introduced fiscal incentives such as:
- 100% SGST reimbursement (net tax) for 10 years from commencement of commercial production, capped at 100% of Fixed Capital Investment (FCI)
- Stamp duty reimbursements for units in notified IT Parks, IT Cities, Technology Parks, and STPIs
- Employment generation subsidies of ₹36,000 per year per employee for units in ‘C’ and ‘D’ category blocks for five years
- Matching grants to skilling and training providers aligned to NSDC skill gap assessments
The 2017 framework also established the HARTRON Start-up Warehouse in Gurugram — a 10,000 sq. ft. facility in partnership with NASSCOM, providing subsidised incubation space to budding entrepreneurs.
ESDM Policy 2024: A Structured Leap Forward
The Haryana Electronics System Design and Manufacturing (ESDM) Policy, 2024 marks a major step forward in the State’s vision to emerge as a leading hub for electronics manufacturing and innovation. Introduced by the Department of Industries & Commerce, Government of Haryana, and implemented through Invest Haryana, the policy seeks to capitalize on Haryana’s strategic geographical advantage, robust industrial infrastructure, and talented workforce to establish a globally competitive ESDM ecosystem.
Key Objectives:
- Attract investments of ₹15,000 crore in electronic manufacturing
- Create approximately 75,000 employment opportunities within the state
- Position Haryana as a key node in the national and global electronics value chain
- Forge partnerships with industry, academic institutions, and research organisations
- Drive innovation through R&D support and infrastructure development
Enterprise Classification:
The policy categorises eligible units as follows:
| Category | Plant & Machinery Investment | Turnover |
| Micro | Up to ₹1 Cr. | Up to ₹5 Cr. |
| Small | Up to ₹10 Cr. | Up to ₹50 Cr. |
| Medium | Up to ₹50 Cr. | Up to ₹250 Cr. |
| Large | More than ₹50 Cr. | More than ₹250 Cr. |
Beyond these, the policy defines Mega and Ultra-Mega units, which are eligible for enhanced packages.
Fiscal Incentives: The Core of the Policy
Capital / Investment Subsidy:
Units are eligible for reimbursement of eligible capital expenditure (CapEx) based on investment size and location across four block categories (‘A’, ‘B’, ‘C’, ‘D’) — with more backward blocks receiving more generous support. Capital subsidy is capped at ₹300 crore and is reimbursed in equal annual instalments.
State Production Linked Incentive (State PLI):
A production-linked incentive is available for a period of 10 years, proportional to the incremental turnover achieved annually. This is capped at 100% of FCI or ₹300 crore, whichever is lower. This mirrors the Central Government’s PLI philosophy but at the state level.
Net SGST Reimbursement:
One of the most attractive features of the policy:
- 50% reimbursement on SGST paid to the state government
- Available for 5 years for units in ‘A’ block
- Available for 10 years for units in ‘B’, ‘C’, and ‘D’ blocks
- Subject to a ceiling of 100% of FCI or ₹300 crore
Employment Generation Subsidy:
To incentivise job creation at the grassroots level, the policy offers:
- ₹48,000 per year per employee for a period of 10 years
- Applicable for skilled, semi-skilled, and unskilled workers
- Employees must be on direct payroll with valid ESI/PF numbers
- Monthly remuneration capped at ₹40,000 per employee
- Employees must hold a Haryana Bonafide Resident (Domicile) Certificate
This provision is a deliberate step toward ensuring that manufacturing jobs benefit local residents rather than being filled entirely by migrant labour.
Stamp Duty Reimbursement:
- 100% reimbursement of stamp duty for units in ‘B’, ‘C’, and ‘D’ category blocks
- Applicable after commencement of commercial production within 5 years from the date of land purchase
Effluent Treatment Plant (ETP) Support:
- One-time reimbursement of up to 50% of expenditure for setting up an ETP, subject to a ceiling of ₹50 lakh — recognising the environmental dimensions of manufacturing
GoI Scheme Top-Up Benefits:
Units that have also availed fiscal benefits under Central Government schemes such as SPECS (Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors) — or any future equivalent scheme — are eligible for additional top-up benefits under the Haryana ESDM Policy, creating a powerful stacking effect that makes the combined incentive package highly competitive.
Non-Fiscal Incentives and Ecosystem Support
The ESDM Policy 2024 goes beyond cheques and reimbursements. It proposes a holistic ecosystem approach:
Innovation Hubs and R&D Facilities:
The policy provides support for capacity building and development of R&D and innovation facilities. This includes assistance for technology acquisition, development of testing laboratories, and fostering industry-academia linkages with engineering colleges and universities in the state.
Green Energy Support:
Reimbursement of expenditures incurred on green energy projects is a distinctive feature, nudging manufacturers toward sustainability. This aligns with the broader national agenda of promoting clean manufacturing.
MSME-Specific Provisions:
The policy contains dedicated provisions for MSMEs, including:
- Support for enhancing productivity and quality
- Improved credit access
- Logistics support
This recognises that MSMEs form the backbone of the electronics component supply chain and cannot be neglected in favour of only attracting anchor investors.
The 2025 Revision: Stakeholder Consultation and Refinement
In May 2025, the Haryana government convened a high-level stakeholder consultation in Gurugram, chaired by Industries and Commerce Minister Rao Narbir Singh, to gather feedback on the Draft Haryana ESDM Policy 2025. This was one of several planned consultations before the policy was finalised.
Chief Technology Officer of the Industries Department, Nitin Bansal, told attendees the ESDM policy aims to make Haryana “a key node in the electronics manufacturing value chain” through innovation hubs, skilling programmes, and infrastructure incentives. Minister Singh declared the state “committed to industrial-led economic growth” and assured stakeholders that “all practical and creative suggestions” would be incorporated.
By October 2025, the Chief Secretary of Haryana reaffirmed the state’s intent to become the leading hub for electronics manufacturing and announced plans to attract investments under the Union Government’s Electronics Component Manufacturing Scheme (ECMS). The ECMS itself offers multiple incentive options — including turnover-linked and capital investment-based benefits ranging between 1% and 25% — which the state policy is designed to complement.
2026: Positioning as a Global Hub
By April 2026, Chief Minister Nayab Singh Saini, while engaging with industry leaders in New Delhi, articulated a broader vision: positioning Haryana as a global destination for ESDM companies, with the upcoming industrial policy offering:
- Capital subsidies for new investments
- Tax benefits to reduce the cost of doing business
- Skill development support to align workforce capabilities with industry needs
- Ease-of-doing-business provisions including faster clearances and single-window facilitation
Microsoft’s representative Sandeep Arora participated in these discussions, specifically suggesting the promotion of AI-based education in schools, ITIs, and other institutions — a sign of the deep convergence between hardware manufacturing policy and the software/AI skills ecosystem.
Strategic Location Advantage
Haryana’s geographical position is a crucial competitive advantage:
- Proximity to Delhi NCR: Access to India’s largest consumer market and a world-class airport (IGI Airport)
- Gurugram and Faridabad: Already established as major industrial and IT corridors
- Manesar: Home to automobile and electronics manufacturers
- Connectivity: National Highways, rail links, and upcoming infrastructure projects (Delhi-Mumbai Industrial Corridor passing through Haryana) all reduce logistics costs significantly
These factors make Haryana particularly attractive for electronics units that need to be close to both input suppliers and end-markets.
Block Category System: Promoting Balanced Development
A distinguishing feature of the policy is its four-block (A, B, C, D) categorisation of the state’s geography. ‘A’ blocks represent the most developed areas (like Gurugram and Faridabad), while ‘D’ blocks are the most backward. This tiered approach:
- Offers higher incentives to units locating in underdeveloped regions, thereby reducing regional inequality
- Prevents industrial activity from being concentrated only in already-prosperous pockets
- Creates manufacturing hubs in newer areas, reducing pressure on urban infrastructure
Alignment with National Policy
The Haryana ESDM Policy is carefully calibrated to work alongside Central Government programmes:
| National Scheme | Relevance to Haryana ESDM Policy |
| Production Linked Incentive (PLI) for IT Hardware | State PLI tops up Central PLI for eligible units |
| SPECS | Units availing SPECS get additional state benefits |
| ECMS (Electronics Component Manufacturing Scheme) | Haryana policy designed to complement ECMS incentives |
| Make in India / Atmanirbhar Bharat | Policy framed as part of this national ecosystem |
This layered approach ensures that investors in Haryana can access both state and central incentives simultaneously, making the total benefit package extremely competitive when compared to competing states.
Challenges and the Road Ahead
Despite its ambitions, the policy faces real challenges:
- Land availability: Industrial land near major corridors is increasingly scarce and expensive
- Skilled manpower: While Haryana has strong STEM educational infrastructure, specialised electronics talent (VLSI design, embedded systems, PCB manufacturing) still needs significant development
- Supply chain depth: Electronics manufacturing requires a deep local supplier ecosystem; Haryana currently lacks some of this depth compared to Tamil Nadu or Karnataka
- Competition from other states: Tamil Nadu, Karnataka, Telangana, and Uttar Pradesh are all aggressively competing for the same ESDM investments
- Implementation gap: Transforming well-drafted policy into on-the-ground outcomes — with timely reimbursements, single-window clearances, and responsive bureaucracy — remains the eternal challenge in Indian industrial policy.
Conclusion
The Haryana Electronics System Design & Manufacturing (ESDM) Policy represents one of the most comprehensive and structured efforts by any Indian state to build a world-class electronics manufacturing ecosystem. From its foundational 2017 iteration through the detailed 2024 framework and the ongoing 2025–26 refinements, the policy has evolved into a multi-dimensional instrument that combines generous fiscal incentives, R&D support, skilling infrastructure, green manufacturing provisions, and strategic alignment with national schemes.
With an investment target of ₹15,000 crore, a job creation goal of 75,000 positions, and a government that is actively engaging with global industry leaders, Haryana has the ingredients to emerge as a serious contender in India’s electronics manufacturing race. Whether it can convert policy intent into industrial reality will depend on consistent implementation, investor-friendly administration, and sustained political will — all of which the Saini government has signalled its commitment to delivering.
As India works to raise its global electronics manufacturing market share from 3% toward a target of 10% and beyond, states like Haryana that take ESDM seriously will be crucial building blocks of that national ambition.
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