The cabinet has given its approval for the special Incentive Package scheme wherein to which the government will provide Rs 100 billion for the next five years to increase production of electronic products and components in India.
“This scheme is expected to create indigenous manufacturing eco-system for electronics in the country. It will foster the manufacturing of indigenously designed and manufactured chips creating a more cyber secure ecosystem in the country,” said an official statement.
Under the scheme, government will provide incentives up to Rs 100 billion during the 12th Five Year Plan period (2012-17).
“The projects with incentives of Rs 100 billion have potential to create employment for nearly 0.5 million persons,” the statement said.
The scheme will provide subsidy for investments in capital expenditure with a limit of 20 percent for investments in Special Economic Zone and 25% in non-SEZs.
Under MSIPS, investors will get reimbursement of countervailing duties and excise for capital equipment for units set up outside SEZ.
“For high technology and high capital investment units, like fabs (units for making electronic chips), reimbursement of central taxes and duties is also provided.” it added.
This includes telecom, IT hardware, consumer electronics, medical electronics, solar photo-voltaic, LEDs, LCDs, strategic electronics, avionics, industrial electronics, nano- electronics, semiconductor chips, other electronic components, contract manufacturing.