India is poised to become the next electronics manufacturing hub and we seek government’s support to help us taking the country to the next level.
IESA believes that the electronics industry can create an ecosystem in India, including High Tech manufacturing of Electronics subsystems, Electronics Manufacturing Clusters, Semiconductor fabs and ATMP Units, which can provide employment to 27 million people in the next 10 years. We believe India is moving in the right direction and appreciate the government’s initiatives to enable India as the manufacturing destination with continued focus on building more greenfield and brownfield electronics manufacturing clusters and incubation centres to create the ecosystem and promote the idea of entrepreneurship and innovation.
The present duty structure is a roadblock for the Indian manufacturing companies where components used to make finished electronic products attract Basic Customs Duty (BCD), but finished products do not. This makes it unviable to manufacture these products in India. The government should focus on removing anomalies in inverted duty structure and import of finished electronic products should be subject to mandatory inspection and certification. We would also urge the government to implement GST on an immediate basis and rationalise indirect tax structure of 12% (8% Excise + 4% VAT) on the electronics manufacturing value chain.
There is a high requirement for a Deemed Export status for electronic and semiconductor sector to address disabilities and have preference for local value added manufactured products. A faster approval mechanism of Electronic Development Fund with greater incentivization to R&D and extended support of the government to the companies who have shown willingness to help us in creating the ESDM ecosystem in India would be welcome.
About the India Electronics and Semiconductor Association
IESA is the premier trade body representing the Indian Electronic System Design and Manufacturing (ESDM) industry and has represented it since 2005. It has over 200 members, comprising both domestic and multinational enterprises. IESA is committed towards building global awareness for the Indian ESDM industry and is supporting its growth through focused initiatives in developing the ecosystem. This is through publishing credible data, networking events and alliances with other international associations. IESA works closely with the Government as a knowledge partner on the sector, both at the centre and at the state level. For more details, visit www.iesaonline.org
