Government of India (GOI) is giving special attention to promote ESDM sector in India and permits 100% FDI through the automatic route for most of the ESDM products. GOI also provides 2% to 5% incentives for large number of electronic items on exports. GOI has approved National Policy on Electronics (NPE), 2012, with the main objective to achieve a turnover of about USD of 400 Bn by 2020 involving investment of about USD 100Bn about employment to around 28Mn.

            This interalia includes achieving a turnover of USD 55Bn of chip design and embedded software industry, USD 80Bn of experts in the sector. Over the last few years, India is increasingly becoming a destination for chip design, embedded software and board design. Many leading companies have established their R&D centres in the country.

          Modified Incentive Package Scheme (MSIPS) which provides capex subsidy of up to 25%  for new units in electronics manufacturing, its expansion or relocation from abroad has attracted investment proposals worth about 65,000 crore in a very short span of time for setting up electronics manufacturing facilities in India. Other proposals are under various stages of appraisal and approval.

          Another scheme which industry is very appreciative of is the Electronics Manufacturing Cluster (EMCs) Scheme which aims to encourage manufacturing of specific high priority electronic product lines in India by providing capital grant for creation of electronic manufacturing clusters.

            Government also provides preference to Domestically Manufactured Electronic goods, where in the extend of Govt. procurement from domestic manufacturers will not be less than 30% of the total procurement value of electronic products. Products such as laptop, desktop, tablet, smart cards and LEDs, Dot-matrix and telecom equipment have been identified under this policy till now.

           India offers 200,000 engineering graduates per annum and equally large number of skilled blue collar job force at one of the lowest wage rates existing anywhere else in the world. Electronics Sector Skills Council and Telecom Sector Skills Council have been formed to encourage greater participation of private skill development in ESDM industry.

The Sector Wise Breakup Of Investment Proposals Is As Follows:

verticals Proposals in corers
Semiconductor FAB 52,000
Telecom products and hand held phones 8218
LED FAB 1787
Consumer electronics/appliances 791
Semiconductor ATMP 744
Automotive & industrial electronics 706
LED lightening products 204

Speedy implementation of these policy provisions is making industry feel confident about the ESDM opportunity.

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