PLI schemes to reduce dependence on Chinese electronic products: Dhotre

The production linked incentive (PLI) scheme for large-scale electronics manufacturing and IT hardware along with the scheme to promote component manufacturing will reduce the country's dependence on Chinese electronic products, the government said on Wednesday.

Minister of state for Electronics and IT Sanjay Dhotre informed the Lok Sabha that besides these schemes, the government is taking steps to broad-base sourcing of electronic components and raw material in addition to "making available the indigenous counterparts of the Chinese electronic products " by promoting domestic manufacturing.

"The National Policy on Electronics 2019 (NPE 2019) has been notified on February 25, 2019. The vision of NPE 2019 is 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," Dhotre said.

The government is providing an incentive of 4 to 6 per cent to eligible companies on incremental sales (over base year) involved in mobile phone manufacturing and manufacturing of specified electronic components, including Assembly, Testing, Marking and Packaging (ATMP) units under PLI scheme for large-scale electronics manufacturing.

It notified scheme for promotion of manufacturing of electronic components and semiconductors on April 1, 2020 which provides financial incentive of 25 per cent on capital expenditure for the identified list of electronic goods that comprise downstream value chain of electronic products which include electronic components, semiconductor, display fabrication units, ATMP units, specialized sub-assemblies and capital goods for manufacture of aforesaid goods.

According to the information shared by Dhotre, PLI scheme for IT hardware has provision for incentive of 1 to 4 per cent on net incremental sales (over base year) of goods manufactured in India and covered under the target segment, to eligible companies, for a period of four years.

"Electronics Development Fund (EDF) has been set up as a 'Fund of Funds' to participate in professionally managed 'Daughter Funds' which in turn will provide risk capital to startups and companies developing new technologies in the area of electronics and Information Technology. Rs 409 crore has been committed through EDF to 9 Daughter Funds with a targeted corpus of Rs 2,626 crore," Dhotre said.