Amid defence minister Manohar Parrikar conceding that the Make in India campaign lacks clarity, the government is considering giving a huge push to the sector in the forthcoming Budget to ensure success for the campaign.

An official told The Indian Express that the sectors being considered for fiscal sops include electronic goods, medical devices, capital goods, and textiles machinery among others. It is also working on ironing out the issues through a separate policy for the defence sector, the official said.
Parikkar had earlier said on the sidelines of the inauguration of Aero India 2015 that the the government was “planning a separate policy on Make In India”, which would focus on providing level-playing field to all stakeholders.

The official said that a fund is likely to be created and would be used to acquire state-of-the-art technology in capital goods sector, medical devices and electronic goods. This would help the domestic industry to manufacture these heavy machines in the country itself instead of importing them.

The capital goods sector, as gauged by the index of industrial production (IIP), has been largely in the negative zone beginning 2011-12 barring a few aberrations where it had shown growth.

Further, a major push is being planned for the electronic goods sector as well. According to Manufacturers Association of Information Technology, the country imports electronic products worth $16 billion annually. According to government estimates, by 2020, it is expected to go up to $300 billion to address its overall demand of $400 billion electronic goods. The aim is to bring down the dependence on imports. The centre has already issued guidelines to all ministries to give preference to domestically-manufactured electronic products in government procurement to give impetus to Make in India. “Fiscal incentives are being worked out for the sector while
the government is also looking at correcting the inverted duty structure,” the official said.

The push to manufacturing comes amid the sector, which has a weight of more than 75 per cent in the IIP, growing just 2.1 per cent in December as per the latest figures available. Industrial activity had contracted 4.2 per cent in October.

Aiming to bring down imports

* A major push is being planned for the electronic goods sector where the country imports electronic products worth $16 billion annually

* By 2020, it is expected to go up to $300 billion to address its overall demand of $400 billion electronic goods — the aim is to bring down the dependence on imports