Friday, October 10, 2014: The benefits from the Modified Special Incentive Package Scheme (MSIPS) may get extended further for another five years. The scheme aims at boosting electronic manufacturing in the country. The extension of it for the next five years would help including almost the complete range of segment for getting the incentive benefits.
A cabinet note was drafted by Ministry of Communications and IT for the approval of amendments in MSIPS, allowing to extend its validity till 2020 instead of initially set July 2015. It was noted that only those firms would get the benefits which will apply for investment under the Scheme by July 2015.
An official said that the cabinet note has been prepared, keeping in mind the net-zero import of electronics item target, which has to be achieved by 2020. MSIPS scheme was first approved in 2012, mainly to provide reimbursement for taxes and duties to various capital intensive and hi-tech products like electronics chip manufacturing.
The scheme provides 20 per cent on capital investment made in special economic zone and it provided 25 per cent on capital investment if made in non-SEZ areas. The proposal will now also involve LED, solar cells, nano-electronic components, smart cards and many others for reimbursement of central taxes.
Besides that, Government is also planning to reduce minimum investment limit by up to 90 per cent. According to the Government estimates, Indian electronic market may reach till $ 400 billion, and if the corrective measures for reduction of imports would not be taken then the imports might get beyond $ 300 billion.
