Lok Sabha Question No. 569 (UNSTARRED), answered on 2015-12-02
Subject: Electronics Industry
Ministry: COMMUNICATIONS AND INFORMATION TECHNOLOGY
Asked by: SUDHEER GUPTA, SUNIL BALIRAM GAIKWAD, KUNWAR HARIBANSH SINGH, NARANBHAI KACHHADIA, BIDYUT BARAN MAHATO

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS AND INFORMATION TECHNOLOGY (DEPARTMENT OF ELECTRONICS &INFORMATION TECHNOLOGY)

## LOK SABHA UNSTARRED QUESTION NO.  569

TO BE ANSWERED ON: 02.12.2015

## ELECTRONICS INDUSTRY

569 SHRI  SUDHEER GUPTA: DR. SUNIL BALIRAM GAIKWAD: KUNWAR HARIBANSH SINGH: SHRI NARANBHAI  KACHHADIYA: SHRI BIDYUT BARAN MAHATO:

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

- (a) the details of the impact of global  economic slowdown on the electronics industry including  computers;
- (b) whether  this slowdown has put many electronics entrepreneurs in distress;
- (c) if so, the details thereof; and
- (d) the corrective measures taken/being taken by the Government in this regard?

## ANSWER

## MINISTER FOR COMMUNICATIONS AND INFORMATION TECHNOLOGY (SHRI RAVI SHANKAR PRASAD)

- (a),  (b)  and  (c):  As  per  the  world  Economic  Outlook  (WEO)  published  by  the  International Monetary Fund (IMF) in October 2015, global growth declined in the first half of 2015.  The report projects global growth for 2015 at 3.1% which is lower than the growth estimated in the WEO for 2014. While a one to one relationship between slower global growth with production of electronics in  India is  difficult  to  draw,  it  is  seen  that  during  the  first  half  of  2015-16,  certain items of electronics as reported and included in the Index of Industrial Production released by the Central Statistical Organisation (CSO) for the period April - September 2015 showed negative growth. As per Directorate General of Commercial Intelligence and Statistics (DGCIS) figures, export of electronics from India has also shown negative growth during the first half of 2015-16.
- (d)     Statement indicating the measures taken/being taken by the government in this regard is at Annexure.

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## Annexure

## Steps taken by the Government to promote Electronics Hardware Manufacturing in the country

1. Promotion  of  electronics  hardware  manufacturing  is  one  of  the  pillars  of  Digital  India  campaign  of  the Government.
2. Modified Special Incentive Package Scheme (M-SIPS) provides financial incentives to offset disability and attract investments  in  the  electronics  hardware  manufacturing  including  chip  manufacturing.  The  scheme  provides subsidy for investments in capital expenditure - 20% for investments in Special Economic Zones (SEZs) and 25% in non-SEZs.
3. Electronics  Manufacturing  Clusters  (EMC)  Scheme  provides  financial  assistance  for  creating  world-class infrastructure  for  electronics  manufacturing  units.  The  assistance  for  the  projects  for  setting  up  of  Greenfield Electronics Manufacturing Clusters is 50% of the project cost subject to a ceiling of Rs. 50 Crore for 100 acres of land. For larger areas, pro-rata ceiling applies. For lower extent, the extent of support would be decided by the Steering  Committee  for  Clusters  (SCC)  subject  to  the  ceiling  of  Rs.  50  Crore.  For  setting  up  of  Brownfield Electronics  Manufacturing  Cluster,  75%  of  the  cost  of  infrastructure,  subject  to  a  ceiling  of  Rs.50  Crore  is provided.
4. Policy for providing preference to domestically manufactured electronic products in Government procurement is under implementation.
5. Electronic Development Fund (EDF) policy has been approved to support Daughter Funds including Early Stage Angel Funds and Venture Funds in the area of Electronics System Design and Manufacturing, Nano-electronics and  IT.  The  supported  Daughter  Funds  will  promote  innovation,  R&D,  product  development  and  within  the country.
6. A meeting of State IT Ministers and State Government Officials was held on 26.08.2014 to encourage them to actively promote electronics manufacturing. Several States have shown keen interest.
7. Approvals for all foreign direct investment up-to 100% in the electronic hardware manufacturing sector are under the automatic route.
8. Under the Electronics Hardware Technology Park (EHTP) Scheme, approved units are allowed duty free import of goods required by them for carrying on export activities, CST reimbursement and excise duty exemption on procurement of indigenously available goods, as per the Foreign Trade Policy.
9. Tariff Structure has been rationalized to promote indigenous manufacturing of electronic items.
10. Mandatory compliance to safety standards has been notified for identified Electronic Products with the objective to  curb  import  of  sub-standard  and  unsafe  electronics  goods.  As  of  now,  30  electronic  products  are  under  the ambit of this Order.
11. Two Schemes for skill development of 90,000 and 3,28,000 persons, respectively  in the electronics sector has been approved to provide human resource for the industry.
12. Government has approved setting up of two semiconductor wafer fabrication (FAB) manufacturing facilities in India.
13. The 'Scheme to enhance the number of PhDs in the Electronic System Design and Manufacturing (ESDM) and IT/IT Enabled Services (ITES) sectors has been approved. 3000 PhDs are proposed to be supported under the Scheme.
14. Steps have been taken for the development and implementation of the Indian Conditional Access System (CAS) to promote indigenous manufacturing of Set Top Boxes (STBs), keeping in view the huge indigenous requirement on account of roadmap for digitalization of the broadcasting sector.
15. An Electropreneur park has been approved for providing incubation for development of ESDM sector which will contribute IP creation and Product Development in the sector.
16. National Centre of Excellence in Large Area Flexible Electronics (NCFLEX) is being 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.
17. National Centre of Excellence for Technology on Internal Security (NCETIS) is being 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.
18. Centre for Excellence on Internet of Things (IoT) is being set up in Bengaluru jointly with NASSCOM.
19. An Incubation center with focus on medical electronics is being set up at Indian Institute of Technology - Patna.
20. The Department of Electronics and Information Technology (DeitY) 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.

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