ET Rise
12,045.80-67.65
Stock Analysis, IPO, Mutual Funds, Bonds & More

Centre steps up focus on electronics exports

The government is drafting the upcoming National Electronics Policy (NEP) with increased focus on exports as it looks to harness the local capacity in electronic goods, including smartphones built for the domestic market, a top official told ET.

Last Updated: May 24, 2018, 09.23 AM IST
0Comments
ThinkStock Photos
Electronics
The idea is to ensure that there is no excess manufacturing capacity and instead utilise the same to build products for customers globally.
Tax Calculator
NEW DELHI: The government is drafting the upcoming National Electronics Policy (NEP) with increased focus on exports as it looks to harness the local capacity in electronic goods, including smartphones built for the domestic market, a top official told ET. The idea is to ensure that there is no excess manufacturing capacity and instead utilise the same to build products for customers globally.

India is producing close to 22.5 crore mobile phones and the total consumption is around 35 crore in India currently. “The rate at which the production is growing, it will soon reach the level of total consumption,” the official said. This has created a stronger case for looking at how India can have a more exportconducive ecosystem, the official added.

“Among other things, the policy will focus on increasing ease of doing business,” the official said. The official did not detail the incentives which the government will provide under the new policy.

“Exports are a natural opportunity for India, and there is large market in Saarc countries, besides African and East Asian countries, which companies manufacturing in India can leverage,” said Tarun Pathak, associate director at Counterpoint Research. He added that in 2018, India can cross 300 million mobile phone production volume, which will be higher than 225 million achieved in 2017, which will also boost exports.

“Leading OEMs (original equipment manufacturers) can set up their bases here, and players such as Samsung, Nokia, Xiaomi, Oppo and Vivo can begin exporting from India in the near future. Supply chain and ecosystem partners, who are yet to set up base in India, can also find the export opportunity attractive as this would mean the chance of scaling operations for both domestic and overseas markets,” said Pathak.

Considered to be one of the flagship schemes for boosting domestic manufacturing in the country, the Modified Special Incentive Package Scheme (M-SIPS) scheme, which was launched in 2012, will end in December this year. M-SIPS provides for 25% subsidy on capital investment along with a host of other incentives. It is unclear if the government will extend the M-SIPS policy after its term ends.

ET has reported in the past about how the new electronics policy will focus on taking manufacturing to the next level with specific attention to boosting upcoming areas such as medical electronics. Over the past couple of years, a series of changes in the duty structure have led to the reversal of fortunes for the domestic manufacturing industry. There are around 120 mobile manufacturing facilities in India, producing upwards of ?1,20,000 crore. “By 2019-2020, 96% of India’s mobile needs will be met by domestic mobile manufacturing,” Union minister for electronics and IT, Ravi Shankar Prasad told ET in a recent interview.

Also Read

Electronics exports: Budget may retain MEIS incentive

Restore 4% export sop: Electronic companies

Bharat Electronics and Tech Mahindra collaborate to build digital aerospace & defence products

Maintain buy on Bharat Electronics with a target price of Rs 115: Analyst

Budget 2020: Finance Minister announces new electronics manufacturing scheme

Comments
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service