Lok Sabha Question No. 1631 (UNSTARRED), answered on 2021-12-08
Subject: Electronic Products
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: Malook Nagar

## GOVERNMENT OF INDIA MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK SABHA

## UNSTARRED  QUESTION NO. 1631

TO BE ANSWERED ON 08.12.2021

## ELECTRONIC PRODUCTS

## 1631.   SHRI MALOOK NAGAR:

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

- (a) the  State-wise  details  of  the  effective  steps  taken  by  the  Government  to  reduce dependency of country on Chinese electronic products;
- (b) if so, the statewise details thereof; and
- (c) the details of the policies of the Government to provide electronic products at same price after boycotting Chinese electronic goods in the country?

## ANSWER

## MINISTER OF STATE FOR ELECTRONICS AND INFORMATION TECHNOLOGY (SHRI RAJEEV CHANDRASEKHAR)

(a):   Government of India has taken strategic steps and initiatives to broaden and deepen the electronics manufacturing sector in the country and make India global electronics manufacturing hub. The schemes for promotion of electronic manufacturing being implemented  by  Government  of  India  are  available  for  units  established  in  any  state irrespective  of  the  location.  To  reduce  dependency  on  imported  electronic  products,  State Governments are working in tandem with the Central Government.

(b):      Many  State  Governments  have  announced  their  own  Electronic  System  Design  and Manufacturing  (ESDM)  /  Electronics  Manufacturing  policy  in  addition  to  their  Industrial Policy.  The  states  provide  an  array  of  incentives  and  subsidies  e.g.  Production  Linked Incentive  Scheme,  incentive  on  capital  expenditure,  incentive  on  training  and  upskilling workers,  capital  subsidy,  etc.  to  attract  new  investments  and  expansion  of  electronics manufacturing  facilities  by  ESDM  companies.  In  addition,  other  incentives  and  subsidies which  are  applicable  to  other  manufacturing  facilities  are  also  applicable  for  ESDM companies e.g. Rebate on Land Cost, interest subsidy, power / water/ stamp duty subsidy, etc.

Government  of  India  has  also  notified  the  Modified  Electronics  Manufacturing  Clusters (EMC 2.0) Scheme on April 01, 2020 with the objective to provide avenues for expansion and strengthening of electronics manufacturing ecosystem in the country. These clusters are being developed  in  collaboration  with  State  Government  or  their  agency,  Central  Public  Sector Units  (CPSUs)  /  State  Public  Sector  Units  (SPSUs),  Industrial  Corridor  Development Corporations (ICDCs) or Joint Venture of such agencies with Anchor unit(s) or industrial park developers.  These  clusters  provide  world  class  infrastructure  along  with  common  facilities and  amenities,  including  Ready  Built  Factory  (RBF)  Sheds/  Plug  and  Play  facilities  for attracting major global electronics manufacturers along with their supply chain to set up units in such clusters.

- (c):   Following flagship Schemes aimed at 'Atmanirbhar Bharat' have been notified under the aegis of National Policy on Electronics 2019 (NPE 2019).
- (i) Production Linked Incentive Scheme (PLI)for Large Scale Electronics Manufacturing notified  vide  Gazette  Notification  No.CG-DL-E-01042020-218990 dated  April  01,  2020  extends  an  incentive  of  4%  to  6%  to  eligible  companies  on incremental  sales  (over  base  year  2019-20)  involved  in  mobile  phone  manufacturing and  manufacturing  of  specified  electronic  components,  including  Assembly,  Testing, Marking and Packaging (ATMP) units for a period of five (5) years.The total approved scheme outlay is INR 40,995 crore. The scheme is available at the link: https://www.meity.gov.in/esdm/pli.
- (ii) Production Linked Incentive Scheme (PLI) for IT Hardware notified vide Gazette Notification  No.  CG-DL-E-03032021-225613  dated  March  03,  2021  extends  an incentive of 4% to 2% / 1% to eligible companies on incremental sales (over base year 2019-20)  of  goods  manufactured  in  India  and  covered  under  the  target  segment,  to eligible companies, for a period of four (4) years. The Target Segments under the PLI scheme for IT Hardware include (i) Laptops (ii) Tablets (iii) All-in-One PCs and (iv) Servers. The total approved scheme outlay is INR 7,350 crore. The scheme is available at the link: https://www.meity.gov.in/esdm/pliithw.
- (iii) Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) notified vide Gazette Notification No.CG-DL-E-01042020218992 dated April 01, 2020  provides financial incentive of 25% on capital expenditure for  the  identified  list  of  electronic  goods  that  comprise  downstream  value  chain  of electronic  products,  i.e.,  electronic  components,  semiconductor/  display  fabrication units,  ATMP  units,  specialized  sub-assemblies  and  capital  goods  for  manufacture  of aforesaid goods for a period of 5 years from the date of issue of acknowledgement. The total  approved scheme outlay is INR 3285 crore. The scheme is available at the link: https://www.meity.gov.in/esdm/SPECS.

The state-wise list of the companies approved under the first two rounds of PLI Scheme for Large  Scale  Electronics  Manufacturing,  PLI  Scheme  for  IT  Hardware  and  SPECS  is  at Annexure -1.

The  AtmaNirbhar  Bharat  economic  policies  are  aimed  at  strengthening  and  expanding electronics value chain ecosystem including components, strengthening domestic companies, promoting investments and creating jobs.Steps are being taken to broad-base the sources  of  electronic  components  /  raw  material  imports  in  India,  in  addition  to  making available  the  indigenous  counterparts  of  the  imported  electronic  products,  by  promoting domestic  manufacturing  of  electronic  products.    The  steps  taken  by  the  Government  to promote domestic electronics manufacturing are at Annexure-2.

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## Annexure-1

## List  of  Companies approved under First Round of PLI Scheme for Large Scale Electronics Manufacturing for Mobile Phones and Specified Electronic Components

|   Sl. No. | Name of the Company                                               | Segments              | State          |
|-----------|-------------------------------------------------------------------|-----------------------|----------------|
|         1 | Foxconn Hon Hai Technology India Mega Development Private Limited | Mobile Phones         | Tamil Nadu     |
|         2 | Samsung India Electronics Private Limited                         | Mobile Phones         | Uttar Pradesh  |
|         3 | Pegatron Technology India Private Limited                         | Mobile Phones         | Tamil Nadu     |
|         4 | Rising Stars Mobile India Private Limited                         | Mobile Phones         | Tamil Nadu     |
|         5 | WistronInfocomm Manufacturing (India) Private Limited             | Mobile Phones         | Karnataka      |
|         6 | LAVA International Limited                                        | Mobile Phones         | Uttar Pradesh  |
|         7 | Bhagwati Products Limited                                         | Mobile Phones         | Rajasthan      |
|         8 | Padget Electronics Private Limited                                | Mobile Phones         | Uttar Pradesh  |
|         9 | Optiemus Electronics Limited                                      | Mobile Phones         | Uttar Pradesh  |
|        10 | United TelelinksNeolyncs Private Limited                          | Mobile Phones         | Andhra Pradesh |
|        11 | AT&S India Private Limited                                        | Electronic Components | Karnataka      |

|   12 | Walsin Electronics India Private Limited   | Electronic Components   | Andhra Pradesh (proposed)   |
|------|--------------------------------------------|-------------------------|-----------------------------|
|   13 | Ascent Circuits Private Limited.           | Electronic Components   | Tamil Nadu                  |
|   14 | Neolync India Private Limited              | Electronic Components   | Andhra Pradesh (proposed)   |
|   15 | Sahasra Semiconductors Private Limited     | Electronic Components   | Rajasthan                   |
|   16 | Visicon Power Electronics Private Limited  | Electronic Components   | Gujarat                     |

## List  of  Companies  approved  under  the  Second  Round  of  PLI  Scheme  for  Large  Scale Electronics Manufacturing for Specified Electronic Components

|   Sl. No. | Name of the Company                        | Segments              | State            |
|-----------|--------------------------------------------|-----------------------|------------------|
|         1 | TDK India Private Limited                  | Electronic Components | Maharashtra      |
|         2 | Rakon India Private Limited                | Electronic Components | Karnataka        |
|         3 | Vitesco Technologies India Private Limited | Electronic Components | Maharashtra      |
|         4 | Epitome Components Private Limited         | Electronic Components | Maharashtra      |
|         5 | Vishay Components India Private Limited    | Electronic Components | Maharashtra      |
|         6 | ShoginiTechnoarts Private Limited          | Electronic Components | Maharashtra      |
|         7 | Tibrewala Electronics Limited              | Electronic Components | Telangana        |
|         8 | Globe Capacitors Limited                   | Electronic Components | Haryana          |
|         9 | Shivalik Bimetal Controls Limited          | Electronic Components | Himachal Pradesh |
|        10 | Deki Electronics Limited                   | Electronic Components | Uttar Pradesh    |
|        11 | Cipsa Tec India Private Limited            | Electronic Components | Karnataka        |
|        12 | Keltron Component Complex Limited          | Electronic Components | Kerala           |
|        13 | Alcon Electronics Private Limited          | Electronic Components | Maharashtra      |
|        14 | Micropack Private Limited                  | Electronic Components | Karnataka        |
|        15 | Desai Electronics Private Limited          | Electronic Components | Maharashtra      |
|        16 | Continental Device India Private Limited   | Electronic Components | Punjab           |

## List of Applications approved under the PLI Scheme for IT Hardware (Laptops, Tablets, Allin-One PCs and Servers)

| Sl.   | Name of the Company   | Segments   | State   |
|-------|-----------------------|------------|---------|

|   No. |                                                          |                                            |                |
|-------|----------------------------------------------------------|--------------------------------------------|----------------|
|     1 | Dell International Services India Private Limited        | Laptops                                    | Tamil Nadu     |
|     2 | ICT Service Management Solutions (India) Private Limited | Laptops                                    | Karnataka      |
|     3 | Rising Stars Hi-Tech Private Limited                     | Laptops, Tablets, All-in- One PCs, Servers | Tamil Nadu     |
|     4 | Flextronics Technologies (India) Private Limited         | Laptops, Tablets, All-in- One PCs, Servers | Tamil Nadu     |
|     5 | Lava International Limited                               | Laptops, Tablets, All-in- One PCs, Servers | Uttar Pradesh  |
|     6 | Dixon Technologies (India) Limited                       | Laptops, Tablets, All-in- One PCs, Servers | Uttar Pradesh  |
|     7 | Infopower Technologies Private Limited                   | Tablets, All-in-One PCs, Servers           | Uttar Pradesh  |
|     8 | Bhagwati Products Limited                                | Laptops, Tablets, All-in- One PCs, Servers | Rajasthan      |
|     9 | Neolync Tele Communications Private Limited              | Laptops, Tablets, Servers                  | Andhra Pradesh |
|    10 | Optiemus Electronics Limited                             | Laptops, Tablets, All-in- One PCs, Servers | Uttar Pradesh  |
|    11 | Netweb Technologies India Private Limited                | Servers                                    | Haryana        |
|    12 | Smile Electronics Limited                                | Laptops, Tablets, All-in- One PCs, Servers | Karnataka      |
|    13 | VVDN Technologies Private Limited                        | Laptops, Tablets, All-in- One PCs, Servers | Haryana        |
|    14 | Panache Digilife Limited                                 | Laptops, Tablets, All-in- One PCs, Servers | Maharashtra    |

## List of Applications approved under the SPECS Scheme

|   Sr. No. | Applicant                                  | Segments              | State         |
|-----------|--------------------------------------------|-----------------------|---------------|
|         1 | ProtectronElectromech Private Limited      | Electronic Components | Karnataka     |
|         2 | Continental Device India Private Limited   | Electronic Components | Punjab        |
|         3 | Salcomp Technologies India Private Limited | Electronic Components | Tamil Nadu    |
|         4 | IdemiaSyscom India Private Limited         | Electronic Components | Uttar Pradesh |

|   5 | Sahasra Semiconductors Private Limited       | Electronic Components   | Rajasthan     |
|-----|----------------------------------------------|-------------------------|---------------|
|   6 | IFB Industries Limited                       | Electronic Components   | Karnataka     |
|   7 | Tata Electronics Private Limited             | Electronic Components   | Tamil Nadu    |
|   8 | Picl (India) Private Limited                 | Electronic Components   | Haryana       |
|   9 | Panacea Medical Technologies Private Limited | Electronic Components   | Karnataka     |
|  10 | Deki Electronics ltd                         | Electronic Components   | Uttar Pradesh |
|  11 | Epitome components Private Limited           | Electronic Components   | Maharashtra   |
|  12 | Hical Technologies Private Limited           | Electronic Components   | Karnataka     |
|  13 | Tibrewala Electronics Limited                | Electronic Components   | Telangana     |

## Steps taken by the Government to promote domestic electronics manufacturing

1. National  Policy  on  Electronics  2019 :  The  National  Policy  on  Electronics  2019  (NPE 2019) has been notified on 25.02.2019. The vision of NPE 2019 is to position 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.

To  attract  and  incentivize  large  investments  in  the  electronics  value  chain  and  promote exports, following three Schemes have been notified under the aegis of NPE 2019:

- (i) Production Linked Incentive Scheme (PLI)for Large Scale Electronics Manufacturing notified vide Gazette Notification No.CG-DL-E-01042020-218990 dated April 01, 2020 provides an incentive of 4% to 6% to eligible companies on incremental  sales  (over  base  year)  involved  in  mobile  phone  manufacturing  and manufacturing  of  specified  electronic  components,  including  Assembly,  Testing, Marking and Packaging (ATMP) units.
- (ii) Production  Linked  Incentive  Scheme  (PLI)  for  IT  Hardware notified  vide Gazette Notification No.CG-DL-E-03032021-225613 dated March 03, 2021 provides an incentive of 4% to 2% / 1% on net incremental sales (over base year) of goods  manufactured  in  India  and  covered  under  the  target  segment,  to  eligible companies, for a period of four (4) years. The Target Segment under PLI Scheme includes (i) Laptops (ii) Tablets (iii) All-in-One PCs and (iv) Servers
- (iii) Scheme  for Promotion of Manufacturing of Electronic  Components  and Semiconductors (SPECS) notified vide Gazette Notification No.CG-DL-E01042020-218992 dated April 01, 2020 provides financial incentive of 25% on capital expenditure for the identified list of electronic goods that comprise downstream value chain  of  electronic  products,  i.e.,  electronic  components,  semiconductor  /  display fabrication  units,  ATMP  units,  specialized  sub-assemblies  and  capital  goods  for manufacture of aforesaid goods.
- (iv) Modified  Electronics  Manufacturing  Clusters  (EMC  2.0)  Scheme notified  vide Gazette  Notification  No.CG-DL-E-01042020-218991  dated  April  01,  2020  provides support  for  creation  of  world  class  infrastructure  along  with  common  facilities  and amenities,  including  Ready  Built  Factory  (RBF)  sheds  /  Plug  and  Play  facilities  for attracting major global electronics manufacturers along with their supply chain to set up units in the country. The Scheme provides financial assistance for setting up of both EMC projects and Common Facility Centres (CFCs) across the country.
2. 100% FDI :As per extant Foreign Direct Investment (FDI) policy, FDI up-to 100% under the  automatic  route  is  permitted  for  electronics  manufacturing  (except  from  countries sharing land border with India), subject to applicable laws / regulations; security and other conditions.
3. Modified Special Incentive Package Scheme (M-SIPS) : The Scheme was notified on 27 th July, 2012 to provide financial incentives to offset disability and attract investments in the electronics manufacturing sector. It was amended in August, 2015 to extend the period of the  scheme,  enhance  scope  of  the  Scheme  by  including  15  more  product  verticals,  and attract more investment. The scheme was further amended in January, 2017 to expedite the investments. The scheme provides subsidy for capital expenditure - 20% for investments in Special Economic Zones (SEZs) and 25% in non-SEZs. The incentives are available for 44 categories  /  verticals  of  electronic  products  and  components  covering  entire  electronics manufacturing value chain. The Scheme was open to receive applications till 31.12.2018 and  is  in  the  implementation  mode.  Under  the  Scheme,  308  applications  with  proposed investment  of  Rs  83,598  crore  have  been  approved.  Further,  incentives  amounting  to  Rs 1372.33 crore have been disbursed under this Scheme.
4. Electronics Manufacturing Clusters (EMC) Scheme : Electronics Manufacturing Clusters Scheme was notified on 22 nd October, 2012 to provide support for creation of world-class infrastructure along with common facilities and amenities for attracting investment. Under the  Scheme, 19 Greenfield EMCs and 3 Common Facility Centres (CFCs)  measuring an area of 3,464 acres with total project cost of INR 3,762 crore including Government Grantin-Aid of INR 1,538 crore have been approved.
5. Electronics  Development  Fund  (EDF) :  Electronics  Development  Fund  (EDF)  has  been set  up  as  a  'Fund  of  Funds'  to  participate  in  professionally  managed  'Daughter  Funds' which  in  turn  will  provide  risk  capital  to  startups  and  companies  developing  new technologies  in  the  area  of  electronics  and  Information  Technology  (IT).  This  fund  is expected to foster R&D and innovation in these technology sectors. INR 409 crore has been committed through EDF to 9 Daughter Funds with a targeted corpus of INR 2,626 crore.
6. Phased Manufacturing Programme (PMP) has been notified topromote domestic value addition in mobile phones and their sub-assemblies / parts manufacturing. As a result, India has  rapidly  started  attracting  investments  into  this  sector  and  significant  manufacturing capacities have been set up in the country. The manufacturing of mobile phones has been steadily moving from Semi Knocked Down (SKD) to Completely Knocked Down (CKD) level, thereby progressively increasing the domestic value addition.
7. Tariff  Structure has  been  rationalized  to  promote  domestic  manufacturing  of  electronic goods, including, inter-alia, Cellular  mobile  phones,  Televisions,  Electronic  components, Set Top Boxes for TV, LED products and Medical electronics equipment.
8. Exemption  from  Basic  Customs  Duty  on  capital  goods :  Notified  capital  goods  for manufacture of specified electronic goods are permitted for import at 'NIL' Basic Customs Duty.
9. Simplified import of used plant and machinery : The import of used plant and machinery having a residual life of at least 5 years for use by the electronics manufacturing industry has been simplified through the amendment of Hazardous and Other Wastes (Management
- and  Transboundary  Movement)  Rules,  2016,  vide  Ministry  of  Environment,  Forest  and Climate Change Notification dated 11.06.2018.
10. Relaxing the ageing restriction : The Department of Revenue vide Notification No.60/2018-Customs dated 11.09.2018 has amended the Notification No.158/95-Customs dated  14.11.1995,  relaxing  the  ageing  restriction  from  3  years  to  7  years  for  specified electronic goods manufactured in India and re-imported into India for repairs or reconditioning.
11. Public Procurement (Preference to Make in India) Order 2017 : To encourage 'Make in India' and to promote manufacturing and production of goods and services in India with a view to enhancing income and employment, the Government has issued Public Procurement (Preference to Make in India) Order 2017 vide the Department for Promotion of  Industry  and  Internal  Trade  (DPIIT)  Order  dated  15.06.2017  and  subsequent  revisions vide  Orders  dated  28.05.2018,  29.05.2019,  04.06.2020  and  16.09.2020.  In  furtherance  of the  aforesaid  Order,  MeitY  has  notified  mechanism  for  calculating  local  content  for  13 Electronic Products viz., (i) Desktop PCs, (ii) Thin Clients, (iii) Computer Monitors, (iv) Laptop PCs, (v) Tablet PCs, (vi) Dot Matrix Printers, (vii) Contact and Contactless Smart Cards,  (viii)  LED  Products,  (ix)  Biometric  Access  Control  /  Authentication  Devices,  (x) Biometric Finger Print Sensors, (xi) Biometric Iris Sensors, (xii) Servers, and (xiii) Cellular Mobile Phones, for procurement to be made from local suppliers.
12. Compulsory Registration Order (CRO) : MeitY has notified 'Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2012' for mandatory compliance to ensure safety of Indian citizens by curbing import of substandard and unsafe electronic goods into India. 63 Product Categories have been notified under the CRO and the order is applicable on 63 product categories.
13. Establishment of Gallium Nitride (GaN) Ecosystem Enabling Centre and Incubator: The project for 'Establishment of Gallium Nitride (GaN) Ecosystem Enabling Centre and Incubator for High Power and High Frequency Electronics' has been approved. The project will be implemented by Society for Innovation and Development (SID), being converted to a Section 8 company titled 'Foundation for Science, Innovation and Development' under the  auspices  of  Indian  Institute  of  Science  (IISc)  at  Centre  for  Nano  Science  and Engineering (CeNSE), Bengaluru.

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