NEW DELHI: India's federal cabinet on Wednesday approved a 121.95 billion rupee ($1.68 billion) plan to promote local manufacturing and export of telecoms and networking gear, the country's telecoms minister said.

The scheme will offer gearmakers annual cash incentives of between 4% and 7% on any increase in sales of locally-made equipment over the next five years, compared with 2019-20 levels.

The plan is part of Prime Minister Narendra Modi's efforts to make India an electronics production hub and to create jobs. It is also aimed at cutting imports, especially from China.

"I would appeal to all telecoms' equipment manufacturers, come on India is waiting for you with this scheme, we'll give you all the help," India's telecoms minister Ravi Shankar Prasad told a news conference.

Last year, India launched a $6.65 billion incentive plan to deepen smartphone manufacturing in the country.

Foxconn, Wistron and Pegatron, three of Apple Inc's top contract manufacturers plan to invest a total of almost $900 million in India over five years to tap into that plan, Reuters has previously reported.

On Wednesday, Prasad recounted the success of the smartphone scheme, saying a top mobile maker will assemble $40 billion worth of devices in India over five years and export them to markets, including the United States and Europe.

"This large company has employed 20,000 people so far and will employ 100,000 directly and 300,000 indirectly by the next year," Prasad said, without naming the company.