India’s push for self-reliance in manufacturing is beginning to show results, with several consumer-facing companies cutting back sharply on their dependence on imports. As per ET, a study of 20 listed firms in automobiles, electronics and FMCG found that foreign exchange outflows as a share of sales have dropped significantly between FY20 and FY25, mainly because of reduced reliance on imported parts and raw materials.
The steepest falls were recorded among auto and electronics makers such as Maruti Suzuki, Tata Motors, Hero MotoCorp, Bajaj Electricals, Whirlpool, Havells, Blue Star, Amber Enterprises and Crompton Greaves Consumer Electricals. In some cases, the share of imports in sales has halved, while others have seen an even sharper decline, as per ET.At Dixon Technologies, the largest contract manufacturer for consumer electronics in India, imports accounted for just 6% of sales in FY25, down from 49% in FY20. Its goods import bill fell 28% year-on-year to Rs 2,418 crore. The company has started sourcing locally for critical components like TV panels, camera modules and compressors. Chairman Sunil Vachani was quoted by ET as saying, “Local value addition due to production-linked incentive (PLI) schemes has gone up from 40-45% to 65-70% in the last five years in categories such as ACs and LED lighting. We now expect a similar result in mobile phones and laptops, with the government’s upcoming electronics component manufacturing scheme.”The government has introduced several PLI schemes over the past five years covering sectors such as mobile phones, white goods, auto components, solar modules, food processing and IT hardware. Alongside, higher import duties and measures like mandatory factory certification by the Bureau of Indian Standards have been used to limit imports and encourage local value addition.For Maruti Suzuki, India’s biggest carmaker, foreign exchange outgo fell to 6% of sales in FY25 from 11.5% in FY20. Tata Motors saw a similar trend, with its share dropping to 1% from 7% during the same period. Hero MotoCorp’s import bill in FY25 was Rs 1,060 crore, about 10% lower than the year before. While the company spent Rs 1,001 crore on imports in FY20, its sales have risen over 40% since then, bringing down the import share in overall revenues.Even FMCG players are seeing a shift. Nestlé, Marico and Britannia have reported a fall in imports as a percentage of sales in the past five years. Parle Products vice president Mayank Shah explained this was due to “import substitution and lower prices of imported inputs such as cocoa and flavours,” ET reported.For multinational firms, outflows also include royalty, licence fees and dividend payments in addition to raw materials and capital goods. ITC chairman Sanjiv Puri clarified at the company’s AGM that its foreign exchange spending was primarily for capital machinery at new factories. “There is hardly any expense in foreign currency for raw materials, and we do not have any royalty payout,” he said.
