The organisation has requested to support assembly of PCB Boards in the country, which has not found mention in the budget.
While the Indian electronics industry is excited to have the electronics policy of 2012 in place, ELCINA finds that none of the recommendations made by the association to rationalize the import duty structure relevant to this sector have been addressed in Union Budget 2013. The organisation had requested to support assembly of PCB Boards in the country, which has not found mention in the budget, tabled by Finance Minister P Chidambaram on 28 February. ELCINA opines that this step itself could have created a huge demand pull for electronic manufacturing in the country!.
In a situation where most of the electronics and hardware industry is subject to zero duty under ITA–1 agreement, quite a number of inputs going into this industry attract import duties of 5 – 10 per cent. The result has been large scale imports, which are expected to exceed oil imports within next 3-4 years. In a press statement issued by ELCINA, the organisation has said, “It appears that the finance minister has been constrained to ignore the request for relief to this industry due to his anxiety to keep the fiscal deficit in check.”
Union Budget, Union Budget 2013, P Chidambaram, ELCINA, ELCINA’s view on budget, PCB manufacturing in India,Budget highlights, Budget for power sector, Budget for electronics sector The benefits announced under the national electronics policy need to be implemented with speed to resurrect electronic manufacturing in the country, read the statement. T. Vasu, president, ELCINA said, “ELCINA is enthused by the special reference to the electronics manufacturing industry and the Electronics Policy 2012 in the finance minister’s budget dpeech and mention of the pivotal role that a semiconductor fab would play for development of this sector. While ELCINA expected more specific sops for the electronic component industry and manufacturing value chain, we fully support the raising of customs duty on set top boxes, which is a huge manufacturing opportunity for spurring expansion of the sector.”
“Indian electronics manufacturing needs huge investments in a few star products such as set top boxes, tablets, LED lighting and mobile phone value chain to open up new opportunities for components, parts, raw materials and assembling activity in electronics. Unless we support these and other similar products our industry will always remain in the vicious cycle of zero duties, cascading taxes and eco-system constraints. The imposition of additional Excise Duty of 5 per cent, now raised to 6 per cent should encourage and enable Mobile Phone manufacturers to source components locally. However we need to beware of the grey market re-emerging in this product,” Vasu added. While the budget rightly focuses on the social sector, ELCINA hopes that sustained support and budgets would be provided for benefits announced under the National Electronics Policy 2012, which will go a long way in strengthening the electronics manufacturing industry in India.
