Govt steps to promote Electronics Hardware Manufacturing in India

By | March 9, 2016

Import of High-Tech Electronics

As mentioned in the National Policy on Electronics (NPE 2012), the demand for electronics in the Indian market is expected to reach USD 400 Billion by 2020. Without intervention, at the current rate of growth, domestic production can cater to a demand of about USD 100 Billion by 2020.

While the future is difficult to predict, the value of imports of electronics goods during the period April-December 2015 was USD 31.06 Billion, which is less than the value of imports of petroleum products during the same period, which were USD 68.20.

Steps taken by the Government to promote Electronics Hardware Manufacturing in the country are given as under:-

  1. Promotion of electronics hardware manufacturing is one of the pivotal Flagship Programme under “Digital India “campaign of the Government.
  2. Modified Special Incentive Package Scheme (M-SIPS) provides financial incentives to offset disability and attract investments in the electronics hardware manufacturing including chip manufacturing. The scheme provides subsidy for investments in capital expenditure – 20% for investments in Special Economic Zones (SEZs) and 25% in non-SEZs.
  3. Electronics Manufacturing Clusters (EMC) Scheme provides financial assistance for creating world-class infrastructure for electronics manufacturing units. The assistance for the projects for setting up Greenfield Electronics Manufacturing Clusters is 50% of the project cost subject to a ceiling of Rs. 50 Crore for 100 acres of land. For larger areas, pro-rata ceiling applies. For lower extent, the extent of support would be decided by the Steering Committee for Clusters (SCC) subject to the ceiling of Rs. 50 Crore. For setting up Brownfield Electronics Manufacturing Cluster, 75% of the cost of infrastructure, subject to a ceiling of Rs.50 Crore is provided.
  4. Policy for providing preference to domestically manufactured electronic products in Government procurement is under implementation.
  5. Electronic Development Fund (EDF) policy has been approved to support Daughter Funds including Early Stage Angel Funds and Venture Funds in the area of Electronics System Design and Manufacturing, Nano-electronics and IT. The supported Daughter Funds will promote innovation, R&D and product development within the country.
  6. A meeting of State IT Ministers and State Government Officials was held on 26.08.2014 to encourage them to actively promote electronics manufacturing. Several States have shown keen interest.
  1. Approvals for all foreign direct investment up-to 100% in the electronic hardware manufacturing sector are under the automatic route.
  2. Under the Electronics Hardware Technology Park (EHTP) Scheme, approved units are allowed duty free import of goods required by them for carrying on export activities, CST reimbursement and excise duty exemption on procurement of indigenously available goods, as per the Foreign
  3. Tariff Structure has been rationalized to promote indigenous manufacturing of electronic items.
  4. Mandatory compliance to safety standards has been notified for identified Electronic Products with the objective to curb import of sub-standard and unsafe electronics goods. As of now, 30 electronic products are under the ambit of this Order.
  5. Government has approved setting up of two semiconductor wafer fabrication (FAB)manufacturing facilities in India.
  6. Two Schemes for skill development of 90,000 and 3,28,000 persons, respectively in the electronics sector have been approved to provide human resource for the industry.
  7. The Scheme to enhance the number of PhDs in the Electronic System Design and Manufacturing (ESDM) and IT/IT Enabled Services (ITES) sectors has been approved. 3000 PhDs are proposed to be supported under the Scheme.
  8. Keeping in view the huge indigenous requirement on account of roadmap for digitalization of the broadcasting sector, Indian Conditional Access System (iCASTM) has been developed to promote indigenous manufacturing of Set Top Boxes (STBs). The iCASTM is available to domestic STB manufacturers at a price of USD 0.5 per license for a period of three years as against market price of USD 4-5 per license for other competing products. The implementation of iCASTM in the cable networks has already started.
  9. An Electropreneur park has been approved for providing incubation for development of ESDM sector which will contribute IP creation and Product Development in the sector.
  10. National Centre of Excellence in Flexible Electronics (NCFlexE) is being set up in IIT Kanpur with the objectives to promote R&D; Manufacturing; Ecosystems; Entrepreneurship; International Partnerships and Human Resources and develop prototypes in collaboration with industry for commercialisation.
  11. Centre for Excellence on Internet of Things (IoT) is being set up in Bengaluru jointly with NASSCOM.
  12. An Incubation center with focus on medical electronics is being set up at Indian Institute of Technology, Patna.
  13. The Department of Electronics and Information Technology (DeitY) provides funding under several schemes for promotion of R&D, including support for International Patents in Electronics & IT (SIP-EIT); Multiplier Grants Scheme and Scheme for Technology Incubation and Development of Entrepreneurs (TIDE) in the area of Electronics, ICT and Management.

This information was given by the Minister of State (Independent Charge) in the Ministry of Commerce & Industry Smt. Nirmala Sitharaman in a written reply in Rajya Sabha today.

Source Ministry of Commerce & Industry 09-March, 2016

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