Recently cabinet has approved three schemes, including a production-linked incentive scheme, with a total outlay of almost ₹48,000 crore.
Objective of such move: To boost large scale electronics manufacturing.
Need of such move:
- Improve domestic supply chain ecosystem of components.
- To provide better electronics infrastructure.
- To provide larger units for anchor units and their supply chain partners.
- To shake off the economic slowdown: attract new investments worth at least ₹50,000 crore in the sector.
- Generate employment: these incentives will help to generate more than 5 lakh direct and 15 lakh indirect jobs.
- To enhance Value addition for mobile phones which is expected to rise by 25-30%.
About Production-linked incentive scheme :
- The scheme aims to attract large investments in mobile phone manufacturing and specified electronic components, including assembly, testing, marking and packaging (ATMP) units.
- It will provide the incentive of 4-6% on incremental sales of goods manufactured in India.
- The scheme is also expected to create a total of 8 lakh jobs.
Scheme for Promotion of Manufacturing of Electronics Components and Semiconductors: The scheme is to be implemented over 8 years and is expected to create about 6 lakh jobs.
Electronics Manufacturing Clusters (EMC) 2.0:
- EMC 2.0 aims at creating quality infrastructure with a minimum area of 200 acres along with industry-specific facilities such as common facility centres, ready-built factory sheds/Plug and play facilities.
- It will help to create around 10 lakh jobs.
Other schemes to promote Electronics manufacturing
National Policy on Electronics
- National Policy on Electronics 2019 (NPE 2019) envisions positioning India as a global hub for Electronics System Design and Manufacturing - (ESDM) by encouraging and driving capabilities in the country for developing core components, including chipsets, and creating an enabling environment for the industry to compete globally.
- The National Policy of Electronics 2019 (NPE 2019) replaces the National Policy of Electronics 2012 (NPE 2012).
- Create an eco-system for globally competitive ESDM sector: Promoting domestic manufacturing and export in the entire value-chain of ESDM.
- Provide incentives and support for manufacturing of core electronic components.
- Formulate suitable schemes and incentive mechanisms to encourage new units and expansion of existing units.
- Promote Industry-led R&D and innovation in all sub-sectors of electronics, including grass root level innovations and early stage Start-ups in emerging technology areas such as 5G, loT/ Sensors, Artificial Intelligence (Al), Machine Learning, Virtual Reality (VR), Drones, Robotics, Additive Manufacturing, Photonics, Nano-based devices, etc.
- Provide incentives and support for significantly enhancing availability of skilled manpower, including re-skilling.
- Create Sovereign Patent Fund (SPF) to promote the development and acquisition of IPs in ESDM sector.
Modified Special Incentive Package Scheme(M-SIPS)
- To offset disability and attract investments in Electronic manufacturing
- The scheme is available for both new projects and expansion projects.
- The scheme provides capital subsidy of 20% in SEZ (25% in non-SEZ) for units engaged in electronics manufacturing.
- It also provides for reimbursements of CVD/ excise for capital equipment for the non-SEZ units.
Electronic Manufacturing Clusters (EMC)
- To make India a global player in the field of Electronics Manufacturing and to offset disabilities faced by industries for reliable infrastructure.
- The EMCs scheme provides grant assistance for setting up of both Greenfield and Brownfield EMCs across the country. The financial assistance under the scheme is in the form of grant-in-aid only.