Lok Sabha Question No. 2944 (UNSTARRED), answered on 2017-08-02
Subject: Benefits of Digital Economy
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: TARIQ ANWAR

## GOVERNMENT OF INDIA

## MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK SABHA UNSTARRED QUESTION NO. 2944

TO BE ANSWERED ON:  02/08/2017

## BENIFITS OF DIGITAL ECONOMY

## 2944 .     SHRI   TARIQ ANWAR:

Will the Minister of ELECTRONICS AND INFORMATION TECHNOLOGY be pleased to state:

- (a) the aspects of the economy likely to be worked on in future in the backdrop of the introduction of new policy by the Government to create digital economy and increase electronic manufacturing;
- (b) whether the digital economy is likely to benefit  the Industrial sector more;
- (c) if so, the details thereof and the action taken by the Government to take the benefit to every sector of the economy; and
- (d) If not, the other economic sectors likely to be benefitted by the digital economy?

## ANSWER

## MINISTER OF STATE FOR   ELECTRONICS AND  INFORMATION TECHNOLOGY (SHRI P.P. CHAUDHARY)

(a)    to    (d):    The  digital  economy  consists  of  Information  Technology  (IT)  /Information  Technology Enabled  Services (ITeS),  Electronics,  Telecommunications,  e-Commerce,  Digital  payments,  Cyber Security,  Internet  of  Things  (IoT),    Digital  Skilling,  etc.  Considering  the  current  and  upcoming opportunities in the digital economy in above mentioned areas, it is estimated by several reports that the size of digital economy would grow to over 1 Trillion US Dollars (USD) by 2024-25. In the recently held meeting between Ministry of Electronics and Information Technology (MeitY) and NASSCOM (National Association of Software & Services Companies), IT/ITeS and Electronics Industries on 16 th June, 2017, the industry leaders also agreed on this and expressed commitment to achieve it in shorter span of time.

The digital economy is already contributing to the growth of industrial sector. The operational efficiency and benefits to all sectors of the economy, including the industrial sector, will further increase with greater use of digital technologies. The introduction of Goods and Services Tax (GST) is a very significant step in the field of indirect tax reforms in India. The implementation of GST has been made possible due to the implementation of the  Goods  and  Services  Tax  Network  (GSTN).  GSTN  has selected  34  IT,  ITeS  and financial  technology  companies,  to  be  called  GST  Suvidha  Providers  (GSPs).  GSPs  would  develop applications to be used by taxpayers for interacting with GSTN.

Promotion of electronics  hardware  manufacturing  is one  of  the  pillars  of  Digital  India  campaign  of  the Government. The National Policy on Electronics (NPE 2012) was notified in October 2012 with the vision to create a globally competitive electronics design and manufacturing industry to meet the country's needs and serve the international market. Over the last few years, Government has taken several holistic, investor friendly and market driven initiatives towards creating a conducive environment for attracting investment in the Electronics System Design and Manufacturing (ESDM) sector. The mobile handset and components manufacturing  has  emerged  as  one  of  the  flagship  sectors  under  'Make  in  India'  initiative.  Significant manufacturing capacities have been set up in India during the last two years in this sector. Over 70 new plants for manufacturing of mobile handsets and components have been set up during this period and the sector has already generated about 1 lakh direct employment.

Besides  promotion  of  electronics  manufacturing,  major  policies  /  schemes  formulated  to  facilitate  and support promotion of digital economy including IT/ITeS are India Business Process Outsourcing (BPO) Promotion  Scheme,  North  East  BPO  Promotion  Scheme,Empanelment  of  Cloud  Service  Providers  for public requirement, Public Procurement (Preference to Make in India), Order 2017 and IT Procurement

Guidelines.  Several  steps  have  been  taken  for  promotion  of  Innovation  and  R&D  in  the  ESDM  sector, which are detailed at Annexure .

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## Promotion of Innovation and R&D

1. Electronic  Development  Fund  (EDF)  policy  has  been  operationalized  to  support  Daughter Funds in the area of Electronics System Design and Manufacturing, Nano-electronics and IT. The fund is housed in Canbank Venture Capital Fund Ltd. The supported Daughter Funds will promote innovation, R&D, product development and within the country.
2. Keeping in view the huge indigenous requirement on account of roadmap for digitalization of the  broadcasting  sector,  Conditional  Access  System,  entitled  iCAS  has  been  developed  to promote  indigenous  manufacturing  of  Set  Top  Boxes  (STBs).  The  iCAS  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 iCAS in the cable networks is underway.
3. An Electropreneur park has set up in New Delhi for providing incubation for development of ESDM sector which will contribute IP creation and Product Development in the sector.
4. National Centre of Excellence in Large Area Flexible Electronics (NCFLEX) has been 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 commercialization.
5. National Centre of Excellence for Technology on Internal Security (NCETIS) has been set up at  IIT-Bombay  with  the  objective  to  address  the  internal  security  needs  of  the  nation  on continuous  basis  by  delivering  technology  prototypes  required  for  internal  security  and  to promote domestic industry in internal security.
6. Centre for Excellence on Internet of Things (IoT) has been set up in Bengaluru jointly  with NASSCOM.
7. An Incubation center with focus on medical electronics has been set up at Indian Institute of Technology-Patna.
8. An Incubation Center at Kochi with focus on consumer electronics is being set up at IIITM.
9. A fabless chip design incubator centre is being set up at IIT Hyderabad to incubate start-ups in semiconductor design. This Incubator will incubate 50 start-ups over a period of 5 years.
10. The  Ministry  of  Electronics  and  Information  Technology  (MeitY)  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.
11. MeitY  has  approved  a  project  to  be  implemented  by  Global  Innovation  and  Technology Alliance (GITA) to promote Innovation, IP, R&D and commercialization of products, etc. in the ESDM sector by providing funding support to an Industry, for doing collaborative research with an Academic Institute in the priority areas with a timeline of not more than two years.
12. MeitY  has  approved  a  project  being  implemented  by  Biotechnology  Industry  Research Assistance  Council  (BIRAC)  to  promote  scientific  and  technological  research  in  Medical Electronics sector in India to address the pressing challenges associated with the development

Annexure of  innovative  medical  electronics  and  making  it  available,  accessible  and  affordable  to  the people at the bottom of the pyramid.

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