Incentives for creation of over 200 electronics manufacturing clusters, 10-year stable tax regime for electronics systems design and manufacturing, and an export push are some of the measures the draft electronics policy envisages.

The Ministry of IT and Communications outlined the broad contours of the draft policy here on Monday. The policy also proposes including computer loans in priority sector lending and declaring mobile phones specifically and other electronics products for data communication as goods of special importance under the Central Sales Tax Act.

Mobile phones under CST

If this comes into effect, such a categorisation would bring them under the declared goods status, which would, in turn, restrict States from imposing a levy beyond the CST rate.

These steps are in addition to the more-publicised elements of the policy, which the Ministry has been talking about for a while now.

These include specific fiscal incentives for electronics production (under Modified ‘Special Incentive Package Scheme'), promoting semiconductor wafer fab facilities, and the controversial proposal of preferential market access for locally manufactured products such as mobile devices and SIM cards with enhanced features.

Together, these proposals form the crux of the full policy prescription for the electronics manufacturing — a sector that has historically lagged behind the services success stories in software and telecom arena.

Policy by December

The draft national policy on electronics, along with similar policies for telecom and IT sectors that will be unveiled in the coming days, are expected to be firmed up by December, the Communications and IT Minister, Mr Kapil Sibal, said.

But he did not spell out the exact incentives or sops that will be on offer, saying these were still in the works.

>moumita@thehindu.co.in

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