Status update: Implementation of MeitY policies

The Department of Electronics and IT (DeitY) has been transformed into the independent Ministry of Electronics and IT (MeitY). Here is an update on how its key schemes are being implemented

By EB Bureau

Modified Special Incentive Package Scheme (MSIPS): This package was earlier launched by the Department of Electronics and Information Technology (DeitY), which came under the Ministry of Communications and IT. With the scope for this department to play a much larger role, the government has now converted DeitY into an independent ministry, called MeitY (Ministry of Electronics & Information Technology). The Modified Special Incentive Package Scheme (MSIPS) provides incentives on a reimbursement basis for investments in capital expenditure—20 per cent for investments in Special Economic Zones (SEZs) and 25 per cent in non-SEZs. It also provides for reimbursements of CVD/excise for capital equipment for the non-SEZ units. For some of the high capital investment projects like fabs, it provides for the reimbursement of central taxes and duties also.
The MSIPS scheme is open for receiving applications till July 2020. For further details, do visit: http://deity.gov.in/esdm/incentive-schemes

Electronics Manufacturing Clusters: The government has notified the Electronics Manufacturing Cluster (EMC) scheme to support the creation of world-class infrastructure to attract investments in electronics manufacturing. Assistance for projects in greenfield EMCs is provided to the extent of 50 per cent of the project cost, subject to a ceiling of ₹ 500 million for every 100 acres of land. For larger areas, a pro-rata ceiling applies. For smaller clusters, the extent of support is decided by the Steering Committee for Clusters (SCC) subject to a ceiling of ₹ 500 million. For brownfield EMCs, 75 per cent of the cost of infrastructure, subject to a ceiling of ₹ 500 million is provided as a grant.

Status: Under this scheme, eight greenfield EMCs and one common facility centre have been approved. In-principle approval has been granted for 16 greenfield EMCs and three brownfield EMCs.

Electronics Development Fund (EDF): The EDF has been set up as a ‘Fund of Funds’ to cater to ‘daughter funds’ which, in turn, will provide risk capital to companies developing new technologies in the area of electronics, nanoelectronics and IT. The EDF will create a vibrant ecosystem of innovation, research and development (R&D) with active industry involvement. The policy provides a framework where the decision to support R&D is based on market conditions and through industry professionals well versed with industry requirements. The government has appointed Canbank Venture Capital Funds Ltd (CVCFL) as the fund manager of the Electronics Development Fund. The EDF is now receiving requests from venture funds, angel funds and seed funds in the areas of electronics, IT and nanoelectronics which, in turn, will provide risk capital to the electronics industry.

Status: Twelve daughter funds have received in-principle approval for ₹ 5.1 billion from the EDF, and four daughter funds have got approval for a final commitment of ₹ 1.79 billion. The total corpus of these daughter funds is around ₹ 68 billion.

Source: Electronics India e-Newsletter MeitY, April-June 2016