In an effort to strengthen electronics manufacturing capabilities in the country, the government has been considering making it compulsory that 30 per cent of the value of all government procurements should be of ‘Made in India’ electronic products.
According to draft proposal, this will extend to tenders of all government ministries, PSUs, government controlled institutions, PPP funded projects and projects under institutional funding from the World Bank and Asian Development Bank. Currently, the Indian telecom sector accounts for the maximum import of electronics hardware. If this proposal is accepted, telecommunications will be the most impacted amongst all sectors.
During a meeting with industry representatives on promoting IT and electronics hardware manufacturing, telecom minister, Kapil Sibal, was in favour of the Finance Ministry providing fiscal incentives for telecom service providers to use products made in India to promote local manufacturing. The Telecom Regulatory Authority of India (TRAI), in its recommendations for the Telecom Equipment Manufacturing Policy, has suggested a rebate for service providers if they use a certain percentage of indigenously manufactured products in their total procurement package.