The Government has selected eight cities where electronics manufacturers will be eligible for concessions. It will also revisit the previous Government’s stalled policy for manufacturing semi conductor chips, Communications and Information Technology Minister Ravi Shankar Prasad told reporters in New Delhi on Tuesday.
The eight cities identified for refunds on equipment for chip manufacturing units are Ghaziabad, Vadodara, Ahmedabad, Gandhinagar, Nagpur, Nasik, Aurangabad and Thane.
The new Government will also try to sort out issues relating to the setting up of two semiconductor wafer fabrication manufacturing facilities, assured the Minister.
Mr. Prasad will be revisiting areas in the IT and telecom sectors where imports will record big growth rates in the absence of domestic manufacturing. Mobile phone imports alone are likely to touch Rs. 60,000 crores during the current fiscal, according to Indian Cellular Association. “Electronic manufacturing is going to be the key area. It is very much employment-based sector. We can give employment to 2.8 crore people,” said the Minister.
Units in eight cities will be eligible for the Modified Special Incentive Package Scheme (M-SIPS) that was unveiled by the previous Government in 2012. Under this, new units will get refunds on capital expenditure. IT will also apply for existing units increasing their capacity by 25 per cent in certain electronics manufacturing clusters.
The Minister’s continued preoccupation with activating the policy framework for domestic manufacturing of electronic components comes at a time when Japan, Taiwan and South Korea are diversifying their investment destinations. High level engagements with the leaderships of South Korea and Japan have touched on attracting their electronics manufacturing to India but drew a limited response due to unhappiness of some multinationals with the previous Government’s taxation regime.