The scheme aims at providing financial support to MSMEs to promote manufacturing, improve quality and encourage exports
By EB Bureau
Friday, May 09, 214: The electronic system design and manufacturing (ESDM) sector in India is dominated by global giants like Samsung, Nokia, Bosch, GE, Sony and Panasonic, to name a few. As a result, the contributions of the micro, small and medium scale enterprises (MSMEs) get ignored. However, despite the presence of the global giants, there are a large number of MSMEs that form the backbone of the electronics industry, not only in India but also in countries like Taiwan, Japan, South Korea and China. Even in Germany, the growth of the medical electronics and industrial electronics sectors is powered by MSMEs.
“In India, it is no different. We need to actively support the MSMEs as part of our agenda to promote ESDM. Given that most of the Indian ESDM units fall under the SME category, this is not a matter of choice,” says Dr Ajay Kumar, joint secretary, Department of Electronics and IT (DeitY), Government of India.
To recognise and motivate the MSMEs in the electronic system design and manufacturing (ESDM) sector, the government has announced a national scheme for them. The scheme aims at providing financial support to MSMEs to promote manufacturing, improve quality and encourage exports.
The support provided
Support under the scheme will be provided in the form of a ‘grant in aid’ to MSME manufacturers for the following activities:
Reimbursement of expenses related to manufacturing electronic goods in compliance with Indian standards: The grant in aid for one model is limited to Rs 100,000, and the total grant in aid available under this section of the scheme is Rs 20 million, for a maximum number of 200 models.
Reimbursement of expenses incurred in the testing and certification required for exports: The grant in aid under the scheme for one model is Rs 150,000, and the total grant in aid available under this section of the scheme is Rs 200 million for a maximum of 800 models.
Development of electronic manufacturing clusters (EMCs) by MSMEs: The total grant in aid available under this section of the scheme for the development of clusters is Rs 20 million. A grant in aid of Rs 1million per cluster will be available for setting up 20 clusters. This grant can be used for expenses incurred in diagnostic study, soft intervention and for preparing detailed project reports, etc.
Who is eligible for this grant?
All MSMEs registered in India, as defined in the MSME Development Act, are eligible to apply for the scheme. In case of EMCs, local industry associations, state government agencies or special purpose vehicles (SPV) can apply for support under the scheme.
The scheme can be availed for two years from the date of its notification for MSMEs or till the allocated budget is available for the scheme, whichever is earlier.
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