Lok Sabha Question No. 191 (STARRED), answered on 2020-03-04
Subject: Electronics Manufacturing Hub
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: Sunil Dattatray Tatkare, Gautham Sigamani Pon

## GOVERNMENT OF INDIA MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK SABHA STARRED  QUESTION NO. *191

TO BE ANSWERED ON 04.03.2020

## ELECTRONICS MANUFACTURING  HUB

## *191.   SHRI SUNIL DATTATRAY TATKARE : SHRI GAUTAM SIGAMAANI PON:

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

- (a) whether  the  Government  has  earmarked  huge  funds  to  ensure  that  big  international manufacturing  firms  set  up  their  global  supply  chains  in  the  country  to  make  it  an electronics manufacturing hub in the next five years and if so, the details thereof;
- (b) whether  the  Government  proposes  to  disburse  funds  to  these  firms  through  productionlinked incentive and replace the popular Modified Special Incentive Package Scheme, if so, the details thereof and the reasons therefor;
- (c) the criteria fixed by the Government for eligibility of companies for availing funds under the production linked incentive;
- (d) the targeted jobs,  exports and direct tax likely to be  generated through production linked incentive; and
- (e) whether the Government has set any tough qualification criteria to ensure that the funds are not used by those who manufacture devices only for the local market and if so, the details thereof?

## ANSWER

MINISTER OF ELECTRONICS AND INFORMATION TECHNOLOGY (SHRI RAVI SHANKAR PRASAD)

- (a) to (e):    A statement is laid on the Table of the House.

## STATEMENT REFERRED TO IN REPLY TO LOK SABHA STARRED QUESTION NO.*191 FOR 04.03.2020 REGARDING  ELECTRONICS MANUFACTURING HUB

- ……..

(a) and (b):  The Government attaches high priority to electronics hardware manufacturing and it is one of the important pillars of both 'Make in India' and 'Digital India' programmes. The National  Policy  on  Electronics  2019  (NPE  2019)  has  been  notified  on  25.02.2019,  with  the vision  to  position  India  as  a  global  hub  for  Electronics  System  Design  and  Manufacturing (ESDM) and create an enabling environment for the industry to compete globally. One of the objectives of NPE 2019 is to promote domestic manufacturing and export in the entire valuechain  of  ESDM  for  economic  development  to  achieve  a  turnover  of  USD  400  billion (approximately  INR  26,00,000  crore)  by  2025.  This  will  include  targeted  production  of  1.0 billion (100 crore) mobile handsets by 2025, valued at USD 190 billion (approximately INR 13,00,000 crore), including 600 million (60 crore) mobile handsets valued at USD 110 billion (approximately INR 7,00,000 crore) for export.

In  order  to  achieve  the  aforesaid  objective  of  NPE  2019,  Ministry  of  Electronics  and Information Technology (MeitY) has formulated the following schemes to incentivize domestic electronics  manufacturing  and  enable  the  big  electronics  manufacturing  firms  to  set  up  their global supply chains in the country to make it an electronics manufacturing hub in the next five years, which are under consideration of the Government:

- (i) Production Linked Incentive (PLI) Scheme for  Large Scale Electronics Manufacturing: The  scheme  proposes  to  provide  production  linked  incentive  of  4  -  6%  on  incremental sales of specific categories of electronic goods manufactured in India, viz., Mobile phones, Specified  electronic  components,  including  Assembly,  Testing,  Marking  and  Packaging (ATMP) units.
- (ii)   Scheme for Promotion of manufacturing of Electronics Components and Semiconductors (SPECS):  The  scheme  proposes  to  provide  financial  incentive  of  25%  on  capital expenditure for the identified list of electronic  goods,  mainly  covering electronic components,  semiconductor/  display  fabrication  units,  ATMP  units,  specialized  subassemblies and capital goods for manufacture of aforesaid goods.

The Modified Special Incentive Package Scheme (M-SIPS) provided subsidy for investments in capital expenditure for setting up electronics manufacturing facilities (20% for units set up in SEZs  units  and  25%  for  non-SEZ  units).  This  scheme  was  open  to  receive  applications  till 31.12.2018 for new projects as well as expansion projects. The proposed PLI Scheme is a new scheme and is not a replacement of the M-SIPS. The proposed SPECS scheme intends to offer financial incentive of 25% of capital expenditure for the manufacturing of specified goods that constitute the supply chain of an electronic product.

- (c), (d) and (e): The eligibility criteria and other details are under consideration.

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