HP India to start local laptop, desktop manufacturing with Dixon from May

HP India is set to kick off local production of its laptops, desktop PCs, and all-in-one systems in May, through a strategic partnership with Dixon Technologies, Moneycontrol reported.

The move is expected to nearly double HP’s manufacturing output compared to the previous year, Ipsita Dasgupta, senior vice-president and managing director of HP India, said as quoted by the report.

The annual target for HP is almost twice what we achieved last year, and that was without PLI, the report quoted Dasgupta saying. HP is one of the 27 companies approved under the ₹17,000-crore Production Linked Incentive (PLI) scheme for IT hardware, which was introduced in 2023.

Confident despite import policy scrutiny
Addressing concerns around India’s new import management system for electronic devices — an issue recently flagged in a US trade report — Dasgupta expressed confidence in the company’s Indian operations.

When asked where India features in HP’s China+1 strategy, Dasgupta said the company’s vision for India predates current global trade dynamics. The company’s business strategy aligns with India’s ambition to become a key player in the global supply chain, she said, adding that HP India plans to increase its share of India-based production year after year.

While HP is working on increasing local value addition, Dasgupta did not confirm whether the company would apply under the newly announced ₹23,000-crore component-focused PLI scheme.

Demand rising across business segments

On business performance, Dasgupta shared that HP is witnessing robust growth in both commercial and consumer segments.

Large enterprises, IT/ITeS firms, and India Inc. are driving commercial demand, while MSMEs, including those in non-metro areas, are increasingly contributing to HP’s sales volumes.

To cater to small and mid-sized businesses, HP has introduced ‘HP Connects’ — customer engagement centres located in MSME hubs. These centres offer both IT infrastructure and consulting services, often acting as outsourced CIOs for businesses without in-house tech teams.

On the consumer front, Dasgupta identified gaming, content creation, and education as key growth areas. HP’s gaming PC segment is performing strongly, with freelancers and online educators increasingly opting for high-performance laptops over mobile devices.

In India, spending on technology often supports income generation or educational goals, the report quoted her as saying.

Global laptop brands turn to India amid shifting supply chains
India’s aspirations to become a major hub for IT hardware manufacturing are gaining traction, as global laptop makers increasingly shift production away from China to Indian partners. This shift is being accelerated by renewed interest in the ₹17,000-crore Production-Linked Incentive (PLI) scheme for IT hardware, which is finally gaining pace after a sluggish start, The Economic Times had reported.

The move comes in the backdrop of ongoing trade war between the United States and China. While exemptions from US tariffs on Chinese IT hardware introduced during the Trump administration remain intact, industry players fear fresh, product-specific tariffs could be introduced as early as May. This uncertainty has prompted several companies to fast-track production agreements with Indian contract manufacturers.

India emerges as a competitive alternative

Indian electronics manufacturers are responding by boosting their capabilities and capitalising on the dual benefits of lower import duties and PLI incentives. These advantages not only make India an appealing manufacturing base but also enable local players to qualify for government procurement tenders, which mandate 20-50 per cent local content in IT hardware.

Despite the momentum, India’s domestic manufacturing is currently meeting only a fraction of the total demand. In FY24, laptop imports were valued at around $11 billion, while local production accounted for roughly $1 billion — about 10–20 per cent of the total.