February 20, 2015: With budget to be out in another one week’s time, India Electronics & Semiconductor Association (IESA) sets out a few recommendations for the Indian government and the Finance Minister to help boost the ESDM eco-system. Ashok Chandak, chairman, India Electronics & Semiconductor Association (IESA), shares his views.
Set up electronics commission: The absence of an electronics commission has been deeply affecting the ESDM players and the ecosystem. There is an immediate need of setting up and Electronic Regulatory Commission(with industry representative) similar to the Telecom Regulatory Commission in India which will act as a One Stop Shop for implementation of policies, regulations, approvals, resolving issues, etc for the electronics companies in India and to provide a fair and transparent policy environment which promotes a level playing field and facilitates fair competition. The Commission thus should make all efforts to encourage the growth of the ESDM sector in the country and will ensure that the country will play an important role in the emerging world information society.
Deemed export status for ITA1 products: The status of “deemed export” should be granted to ita1 products/components manufactured and sold in india. This would enable the benefits of drawback, advance authorization and refund of output Excise duty paid by manufacturers by availing credit of input taxes paid on components imported and made in the country and paid for in cash for value addition. Domestically manufactured electronic products (DMEP) for the purpose of conferring the status of deemed export on them should be identified by using domestic value addition norms, where the threshold progressively increases over the years.
Promote localisation of products and demand:
- Apply additional import duty on NON ITA 1 products
- Fast track DRM transmitters installation to promote Digital Radio’s and Car audio systems designed and manufactured in India
- Implement smart metering in all states electricity boards
- Implement Smart Card based National ID card projects and Contactless payments
- Standards for Cyber Security, smart grid in India, Smart Lighting, Home automation
- Fast track Cyber Security
- Fast Track NOFN and Broadband thru cable network
Preferential Market Access (PMA ): Market access to companies manufacturing products in India – To boost domestic production there is a need to mandate government procurement for electronic products manufactured in India. The existing PMA policies framed should be implemented at an immediate basis to leverage electronic products manufactured in India.
Promote fabless ecosystem: there is also a need to make government purchases of indian product mandatory where indian designed ics have been used in order to promote the globally competitive growing fabless ecosystem in india.
Remove restrictions on used equipments import for research and development: there has been restriction on imports of used electronic equipment which is treated as hazardous waste. However, lots of Value Addition and R&D activities takes place through these used imported electronic equipment. To give a boost to the R&D activities in the ESDM sector, the Govt should consider removing these restrictions.
Correct inverted duty structure anomalies: need for correction of anomalies in the inverted duty structure. Presently due to the Inverted Duty Structure imports of finished goods are encouraged and the import of semi-manufactured goods and components are discouraged which can be further used for manufacturing completed products in the country where substantial value addition can take place.
Speed up investment proposals approvals and disbursement of funds/Incentives to fast track the manufacturing expansions.
