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Govt receives Rs 90,000 crore investment proposals for electronics manufacturing

24 Aug 2015 Evaluate

The government has received Rs 90,000 crore investment proposals for electronics manufacturing in the country in the last two months under the Modified Special Incentive Package Scheme (MSIPS), with significant interest in making mobile phones by both the local and foreign firms. Additional Secretary in Ministry of Communications and IT Ajay Kumar said that there is hardly any company which has not shown interest to manufacture in India and said India is already the fastest-growing Smartphone market and it is now also becoming the fastest growing manufacturing destination of phones in the world.

The global companies who have shown interest to start manufacturing in India are that of, Airbus, Phillips, Thomson, Samsung, LG and Flextronics. Besides, firms like HTC, Asus and Gionee have also evinced interest in setting up their manufacturing base in the country. However, players like Samsung, Micromax and Spice have been assembling handsets in India. Recently, Xiaomi and Motorola, along with Lenovo, have commenced assembling Smartphone in the country through contract manufacturing by Foxconn and Flextronics respectively.

In the last 12 months, the country had received investment proposals worth about Rs 1.10 lakh crore from various companies for electronics manufacturing under MSIPS. Out of the total, over 80% have been materialized in the last two months. The MSIPS policy was originally approved by the government in July 2012, which provides capital subsidy of 20% in SEZ or 25% in non-SEZ units engaged in manufacturing of electronics items. The scheme was for duration of three years which last month got extended to five years to boost electronics manufacturing.

According to the Department of Electronics and IT, the demand for electronics in India is expected to reach $400 billion by 2020, while the sector has potential to attract $100 billion investment and provide jobs to 28 million people.

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