The Electronics Manufacturing Clusters scheme, which aims to boost domestic electronics manufacturing, is expected to be notified in September, according to Telecom and IT Minister Kapil Sibal.
This will provide financial incentives to technology companies that will set up manufacturing operations in India. “Hopefully by September notification of the cluster will also be done,” Sibal said.
The Government will provide financial support of up to Rs 50 crore for setting up a cluster that will take care of all needs for development of specific kind of electronics products, akin to government support provided for manufacturing companies in Taiwan and China.
Domestic market
Under the EMC scheme, approved by the Cabinet, the Government will provide aid to special purpose vehicles to set up such clusters. With software exports coming under increasing pressure due to slowdown in the mature economies, companies – both international and local — are increasingly eyeing the domestic market that is seeing growth. Currently, the size of the electronics industry is estimated at $45 billion and according to the Government will multiply ten-fold to $400 billion by 2020. Already, some initiatives to set up electronic manufacturing have begun.
In June, industry body ELCINA partnered with Vittal Innovation City (VIC) to launch an Electronic Systems Design and Manufacturing (ESDM) cluster. This ESDM cluster will come up in Andhra Pradesh’s Anantapur district, which is 117 km from Bangalore airport. This cluster will come up over 100 acres that has been procured by VIC.
This cluster aims to attract about 40-50 mid-size manufacturers of electronics components. Companies setting up manufacturing bases will get physical infrastructure (such as power back-up), product certifications through test labs, enable knowledge creation, conduct research and development with handholding from VIC’s management team, said N. Vittal, Chairman, Vittal Innovation City. However, once operational, it would be managed by cluster members.