The government is set to announce names of the selected companies for the production-linked incentive (PLI) for manufacturing telecom equipment. Of the 36 companies that have applied for the scheme, a go-ahead has been given to 31 firms, including Foxconn, Flextronics, Nokia, Jabil, Rising Star, Dixon Technologies, VVDN Technologies, HFCL, Tejas Networks, among others.
According to officials, the selected firms are expected to invest over Rs 3,300 crore and bring in incremental production of about Rs 1.80 lakh crore over five years.
Some of the notable absentees for the scheme include Samsung and Cisco. Samsung has reportedly not applied because of lack of opportunities in 5G equipment market for it. Reliance Jio is the only operator which has deployed Samsung radio network for 4G but for 5G, the company has indicated to utilise home-grown solution and so far, not committed to Samsung.
The scheme, with an outlay of Rs 12,195 crore, offers incentives in the range between 4% and 7% for different categories and tenures. For the MSMEs, a 1% higher incentive is proposed in year 1, year 2 and year 3. The financial year 2019-20 will be treated as the base year for computation of cumulative incremental sales of manufactured goods net of taxes.
The minimum investment threshold for MSMEs has been kept at Rs 10 crore and for others at Rs 100 crore. Telecom equipment that would get covered under the scheme, includes core transmission equipment, 4G/5G next-generation radio access network and wireless equipment, access and customer premises equipment (CPE), Internet of things (IoT) access devices, other wireless equipment and enterprise equipment like switches, routers, etc.
The scheme is expected to offset huge imports of telecom equipment worth more than Rs 50,000 crore and reinforce it with Made-in-India products both for domestic markets and exports.