New Delhi [India], Mar 21 : As part of efforts to strengthen electronic manufacturing ecosystem in the country, the Union Cabinet has approved the Scheme for Promotion of manufacturing of Electronic Components and Semiconductors (SPECS), which will provide 25 per cent of capital expenditure incurred in manufacturing items that are part of the supply chain of an electronic product.
Briefing reporters about the decisions of the Cabinet on Saturday, Communications, Electronics and Information and Technology Minister Ravi Shankar Prasad said the proposal will lead to the development of electronic components manufacturing ecosystem in the country and deepening of the electronics value chain. The Cabinet meeting took place on Friday.
SPECS will help meet the constraints in domestic manufacturing of electronic components and semiconductors.
The total cost of the scheme is about Rs 3,285 crore, which includes the incentive outlay of approximately Rs 3,252 crore and the administrative expense to the tune of Rs 32 crore.
With Rs 20,000 crore new investments expected in the electronics sector, the scheme would lead to direct employment of about 1,50,000 in the manufacturing units supported under it and indirect employment to 4,50,000.
It will also lead to a reduction in dependence on import of components and their large scale domestic manufacturing to enhance digital security of the country.
An official release said that the vision of National Policy on Electronics 2019 (NPE 2019), notified in February last year, was to position India as a global hub for Electronics System Design and Manufacturing (ESDM) by encouraging and driving capabilities in the country for developing core components, including, chipsets, and creating an enabling environment for the industry to compete globally.
A vibrant electronic components manufacturing ecosystem is vital for the overall long-term and sustainable growth of electronics manufacturing in India and essential to achieve net positive Balance of Payments (BoP), it said.
The release said that the decision entails an incentive of 25 per cent on capital expenditure on plant, machinery, equipment, associated utilities and technology, including for research and development to industrial units manufacturing electronic components, semiconductors, Assembly, Testing, Marking and Packaging (ATMP) lines, specialised sub-assemblies besides capital goods for these items in the specified categories.
The scheme will cater to all segments of electronics manufacturing such as mobile electronics, consumer electronics, industrial electronics, automotive electronics, medical electronics, strategic electronics, power electronics, telecom equipment and computer hardware.
( With inputs from ANI )