Wednesday, December 18, 2013: Preferential Market Access policy (PMA) stresses on domestic sourcing of technology products that can pose threat to the security of the nation. In the latest, private sector has been exempted from the revised PMA by the government.
A government source on condition of anonymity shared with PTI, “The Cabinet approved revised PMA in first week of December. The only change is that it will not apply on private sector. The Ministry of Communications and IT will notify it soon.”
While there were reports that the revised policy proposed including defence sector, it is being said that the defence ministry acted against it and preferred to stay out of it.
In July this year, the Prime Minister’s Office (PMO) directed the IT and Telecom Ministry to revise the framework and leave out telecom equipment or other technology products that are procured by private sector from the policy.
There are many industry experts who fear that the revised policy can put investments into the domestic sector in trouble. “It may be noted here that an investment pipeline has already been created under the M-SIPS policy, and such policy shifts can jeopardise further investments into the sector,” PVG Menon, president, Indian Electronic & Semiconductor Association told Business Standard.
Then there is Modified Special Incentive Package Scheme (M-SIPS) investment-based scheme that attracts investment in Electronics Systems Design and Manufacturing (ESDM).
Menon feels that the recent policy revision can confuse the investors. “This is especially so at a time when we are on the threshold of getting significant investments into the ESDM sector, by both Indian as well as foreign companies.”