HYDERABAD: Giving impetus to electronics manufacturing, the Government of Andhra Pradesh (AP) Tuesday unveiled a new Electronics Policy 2014-2020, which aims at attracting Rs 30,000 crore ($5 billion) investment besides employment creation of 0.4 million by 2020.
The policy, which supersedes the AP Electronics Hardware Policy 2012-17, will develop 20 electronics manufacturing clusters (EMCs) across the State in six years.
The Indian electronics market is pegged at $70 billion as on March 2014 and is expected to touch a whopping $400 billion by 2020. But with the low domestic manufacturing base, the demand-supply gap is likely to reach $300 billion by 2020.
Targeting a slice of the $400 billion market, the government has identified thrust areas like semiconductors, mobile, LED, smart meters, FPD TVs, tablets, base stations, smartcards and sensors. It has notified electronics hardware industry as essential service under AP Essential Services Maintenance Act.
To attract companies, the policy offers non-fiscal incentives under various heads like the Factories Act 1948 and the AP Shops & Establishments Act 1988 and fiscal incentives like registration & stamp duty, power subsidies, exemption of electricity duty, VAT/ CST reimbursement, investment subsidies, rebate on land cost.
Additional incentives are also earmarked for mega projects with minimum investment of Rs 250 crore or those creating employment of more than 2,000 in five years. Interestingly, the policy includes a provision that in case the required approvals are not granted within four weeks of receipt of an application in full shape, the approval shall be deemed to have been granted.
As for skill creation, besides others, the policy aims at producing 250 PhDs in electronics by 2018. A high-level, empowered ‘single window clearance unit’ will also be created, which would be supported by the state-of-the-art centralised round-the-clock help desk besides creating a joint government-industry committee to market India and attract investments in the country.
A fund under the management of the committee comprising representatives of industry bodies and government with an equal stake to promote design, manufacturing, assembling and innovation. The policy also aims at reserving two clusters/areas to be developed as electronics hubs in the upcoming ITIR in Visakhapatnam, which is also being proposed as the mega electronics hub for the State. Those companies using renewable source of energy with a minimum 40 per cent of their power requirements coming from renewable sources for operations and manufacturing will be eligible for additional incentives such as electricity duty exemption for five years and sales tax exemption for two additional years.
Lastly, the government has proposed an annual mega electronics event in partnership with the industry to showcase and promote electronics industry besides setting up ‘Electronics Bazaars’ at Visakhapatnam, Vijayawada and Tirupati, which would act as G2B/B2B/B2G/B2C platforms to market electronic products.
An autonomous empowered mission for electronics & IT promotion society will be set up at Visakhapatnam for faster clearances. It will be headed by a technocrat and will have three experts in electronics and IT, two academics and an expert in marketing and promotion.