The Central government on Saturday announced a slew of measures including production-linked incentives to make India a hub of electronics and pharma sectors in a bid to generate manufacturing revenue potential of Rs 10 lakh crore by 2025 and direct and indirect employment to around 20 lakh people.
The decisions were taken at the Cabinet meeting, which took place on Friday under the chairmanship of Prime Minister Narendra Modi.
Addressing a press conference here, Union Minister Ravi Shankar Prasad said: "The Cabinet took decisive decisions to make India a manufacturing hub. Two long-term policy decisions have been taken to make India a hub of electronics and pharma manufacturing sectors."
"During 2014-15, the manufacturing of worth Rs 1,90,000 crore was done in the country, which went up to Rs 4.58 lakh crore in 2018-19. There is a compound growth rate of 25 per cent," said Prasad.
"Now India's contribution to global manufacturing has increased to three per cent from 1.3 per cent in 2012. Around 20 lakh people have been employed. When our government came, there were only two mobile manufacturing factories. Now there are 260 units," he added.
The minister said that the government has decided to come up with new policies to increase the manufacturing of mobile, electronic and components.
"For this, we have taken three decisions. In 2018, the government came up with the National Electronic Policy. We are also planning to invest Rs 20 lakh crore in the electronic manufacturing sector and employ around Rs 25 lakh people," he said.
Prasad announced production-link incentive schemes for the promotion of manufacturing of electronic components, semiconductors and manufacturing cluster
"Under the production-linked incentive, we request global companies to come to India and invest here. They will get 4-6 per cent incentive on the basis of their investment and their incremental sales. This incentive is linked to its production in India. We also want to make 3-4 Indian companies 'Champion Companies'. We will allot Rs 40,950 crore for production linked incentive in five years," he said.
He also said that an incentive of 25 per cent will be given on capital expenditure for manufacturing firms.
"For the promotion of electronic component and semi-conductor manufacturing, if India wants to move ahead in the field of electronic, then the country should also be the centre of component manufacturing. We will give 25 per cent incentive on capital expenditure, machinery, equipment, technology, and R & D support," he said.
The minister said: "In mobile, consumer electronics, industrial electronics, automobile electronics, medical electronics, power electronics, telecom electronics, there will be an incentive of Rs 3,285 crore on capital expenditure."
Speaking about the scheme for manufacturing cluster, Prasad said: "A big company will come in the cluster along with all the associated value chain to make the finished product a big one. There will be global and domestic companies as well. There will be a cluster of 200 acres and 100 acres in northeast and hilly areas. Those who make a minimum investment of Rs 300 crore, we will give them an incentive."
"Because of all these three schemes, we hope to generate manufacturing revenue potential of Rs 10 lakh crore by 2025 and generate direct and indirect employment to around 20 lakh people. 57 mobile manufacturing factories have come up in Noida and Greater Noida," he said.
The Cabinet has approved four schemes with an incentive outlay of Rs 9,940 crore and Rs 3,820 crore for bulk drugs and medical devices respectively to boost their domestic production and for the promotion of 'Make in India' and exports while substituting their imports.
Union Minister Mansukh Mandaviya said that the Government of India will spend Rs 1,000 crore for bulk drugs parks. "Whichever state offers 1,000-acre land, the park will be established there. If private units manufacture bulk drugs, they will get 20 per cent incentive for five years," he said.
He said the Cabinet has approved a scheme to create common infrastructure in three Bulk Drug Parks, which will address 'Drug Security' of the nation.
"We will establish four medical device parks in four states. We will give Rs 1,000 crore to those states, which develop medical device parks," the minister said.
Mandaviya said that a production-linked incentive scheme for domestic manufacturing of medical devices has been approved by the Cabinet for targeted sectors like radiotherapy, radiology, anaesthetics, implants, etc., to promote 'Make In India' and import substitution of Rs 61,593 crore.
"A majority of medical devices of cancer, radiology, anaesthetic and cardiorespiratory and heart are being imported. Those companies which manufacture these medical devices, they will get 5 per cent incentive," he said.
"A scheme has been approved by the Cabinet to set up medical device parks for domestic production of medical devices with an expected rate of 14.8 per cent CAGR. These parks will provide centres and labs for manufacturing of medical devices for targeted segments," he added.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)