Electronics companies will be encouraged to set up their bases in India along with their suppliers, so that the whole ecosystem can be developed.
A revamped scheme in which suppliers to an anchor electronics unit are located close to the mother unit is on the cards. The scheme is an extension of the electronic manufacturing clusters (EMC) scheme, which has now been discontinued with no new applications being sought. The government is trying to replicate the success of the auto sector in making India a manufacturing hub in the field of electronics. Electronics companies will be encouraged to set up their bases in India along with their suppliers, so that the whole ecosystem can be developed.
Communications and IT minister Ravi Shankar Prasad is set to meet the top bosses of electronics companies on September 16 to understand their problems and seek suggestions on ways to improve the manufacturing ecosystem.
The government wants these companies to increase their capacity so as to make India as an export hub. The meeting is expected to see participation by leading players like Vivo, Oppo, Qualcomm, Xiaomi, Dell, HP, Bosch, Cisco, Flextronics, Foxconn, Nokia, LG and Panasonic. Other participants include Intel, Wistron and Sterlite Technologies.
Ajay Prakash Sawhney, secretary, ministry of information and technology (MeitY), said: “We are proposing to move towards a scheme where an anchor unit comes in along with its supply chain.” The policy is an extension of the electronic manufacturing clusters (EMC) scheme, which has now been discontinued as no new applications are invited for it.
Under the EMC scheme, first notified in 2012, the government provides financial assistance for dedicated electronic manufacturing zones. For greenfield EMCs, the assistance is provided up to 50% of the project cost subject to a ceiling of Rs 50 crore for every 100 acres of land. In the case of brownfield EMCs, the assistance is up to 75% of the project cost subject to a ceiling of Rs 50 crore. The government has received around 50 applications under the scheme.
However, in the revised plan, the government is targeting bigger clusters wherein whole ecosystem will be set up at one place as has happened in the case of Maruti Suzuki, which brought suppliers to India. “We would like to make them comfortable and help bring down costs by ensuring the supply chain is in the same place,” Sawhney said.
Over the last four years, phone manufacturing has picked up in India. In 2018-19, the size of mobile phone manufacturing was 29 crore units worth Rs 1.70 lakh crore in contrast to 2014-15, when 6 crore units worth Rs 19,000 crore were made.
Sawhney said the government has firmed some plans, which will be refined after the meeting with the industry. “We have some draft schemes in mind but after getting inputs from CEOs we will fine tune what kind of an ecosystem we want to evolve,” the secretary said.