The Ministry of Electronics and Information Technology (MeitY) has approved a total of 314 applications with proposed investments of Rs 86,824 crore under a Modified Special Incentive Package Scheme (M-SIPS) till May 31, 2022.
- Among the approved proposals in May 2022, there is an investment of Rs 596 crore from Bosch Automotive Electronics Private Limited.
- As on May 31, 2022, incentives of Rs 1,774.47 crore have been disbursed to 114 applicants.
What is M-SIPS?
Introduced in 2012, it envisages attracting investments in Electronics System Design and Manufacturing (ESDM) Industries. It has been amended twice in August, 2015 and in January, 2017, and mainly provides a capex (Capital expenditures) subsidy of 20-25% for setting up electronic manufacturing units.
i.IFCI Limited (formerly Industrial Finance Corporation of India), a Government of India undertaking, is a Verification Agency for verification of claim seeking incentives under the M-SIPS.
ii.M-SIPS was the first scheme under which the government tried to attract electronics manufacturing companies.
- Samsung, LG, Bosch, Tejas Networks, Motherson Sumi Systems, Tata Power SED, Nidec India, Nippon Audiotronix, Continental Automotive, GE BE and Wipro GE healthcare were the initial applicants for the scheme.
iii.To attract global mobile makers, the government has also come up with Production-Linked Incentive (PLI) schemes.In October 2020,16 proposals from domestic and international companies were awarded of Rs.11,000 crore investment to manufacture mobile phones worth Rs 10.5 lakh crore over the next five years.
- The companies include iPhone maker Apple’s contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung and Rising Star. Domestic companies whose proposals have been approved include Lava, Bhagwati (Micromax), Padget Electronics (Dixon Technologies), UTL Neolyncs and Optiemus.
Salient Features of the scheme :-
- Capital Subsidy – 20% for investments in Special Economic Zones (SEZs) and 25% in non-SEZs.
- Incentives for both new units and expansion units.
- Incentives for a period of 5 years from the date of approval of application.
- Incentives for 44 categories/verticals across the value chain (raw materials including assembly, testing, packaging and accessories, chips, components).
- Minimum investment threshold for each product category/ vertical (from Rs 1 crore for manufacturing of accessories to Rs 5000 crores for memory semiconductor wafer fabrication unit.
- Unit to be in Industrial Area notified by Central/State Govt.
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About Ministry of Electronics and Information Technology (MeitY):
Union Minister – Ashwini Vaishnaw (Rajya Sabha – Odisha)
Minister of State (MoS) – Rajeev Chandrasekhar (Rajya Sabha – Karnataka)