Wednesday, October 15, 2014: Indian government’s Modified Special Incentive Package Scheme (M-SIPS) policy is set to benefit companies like Samsung Electronics and Bosch India, which will be the first ones too to grab the advantages of the policy.
A senior official from Department of Electronics and Information Technology (DeitY) has told Business Line that the government is trying to reimburse these companies from this year only. The department is likely to start talks with the Finance Ministry soon and the proposal will soon head to the Cabinet for its approval. Samsung, Bosch and Sahasra’s investment proposals, worth Rs 9,610 million, have already been approved by the Cabinet. Now under the new policy the government will provide incentives on investments in the electronic systems design and manufacturing (ESDM) sector.
The subsidy structure falls like 20 per cent for investments in special economic zones (SEZs) and 25 per cent in non-SEZs. Reimbursements of countervailing duties (CVD) or excise for capital equipment for the non-SEZ units will also be facilitated under the new policy. Till last year, investment proposals up to Rs 46,000 million, have been received by the government for manufacturing consumer electronics, telecom products, hand-held devices, automotive electronics, and semiconductors. 40 applications for investments of around Rs 146,240 million, under the M-SIPS policy, have been received by August, 2014. 16 projects out of those proposed ones have been approved by the government.
As per the official, the new Digital India campaign aims at faster project implementation and quicker reimbursement of investments. Recently two foundation stones of electronic manufacturing clusters were set up in Madhya Pradesh and such clusters are expected to come up in other states too. The incentives will be valid up to 10 years from the date of the approval. The new scheme will benefit manufacturers of electronics like fully automatic washing machines, refrigerators, air-conditioners, microwaves and more.