The Hindu Business Line : Govt mulls more sops for electronics, IT hardware

The Commerce and Industry Minister, Mr Kamal Nath, said electronics hardware technology parks and special economic zones (SEZs) were tailored to strengthen the country's manufacturing base in electronics.

Emphasising the importance of electronics and hardware manufacturing, Mr Nath indicated that the Government was considering a bigger package of fiscal and other incentives for electronics and IT hardware manufacturing sector.

SEZ policy

"SEZ policy provides an appropriate environment for setting up information technology/ information technology-enabled services SEZ, including SEZs for electronics hardware manufacturing," he said, while addressing the 27th annual function of the Consumer Electronics and TV Manufacturers Association (CETMA) here.

He said the bigger package of fiscal and other incentives for the sectors were to make the industry globally competitive; to attract more FDI in the industry; to bring down the prices of end products; to reduce production cost; to step up volumes to take advantage of economies and efficiencies of scale; to increase the demand; to compensate for disabilities until the basic infrastructure constraints are removed; and to move towards much lower taxation levels in the next 3-5 years.

The consumer electronics sector, which is the main stay of the domestic electronics industry, contributes about 35 per cent of the total electronic hardware production in India and colour TVs are the largest contributor to this sector.

Lower taxation

In order to encourage investments in the sector, CETMA has requested the Government to lower the present level of taxation from over 30 per cent to 12 per cent and allow for more flexible labour laws.

Meanwhile, the association also announced that to reflect its change in identity the name CETMA would be changed to Consumer Electronics and Appliances Manufacturers Association (CEAMA) from December 1.

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