Extending the Prime Minister Narendra Modi's 'Make In India' concept, the government of Gujarat has made a generous move to encourage electronics manufacturing in the state. As per the newly announced electronics policy of the state, among other sops, the government will offer 100 per cent subsidy on central sales taxes (CST) and VAT refund equal to 90 per cent of capital investment made for expansion of the existing manufacturing units.
The government aims to generate employment for about 5 lakh people under the new policy which aims to attract investment of about $6 billion (approx Rs 3600 crore) by 2020 and generate business worth $16 billion (approx Rs 9600 crore).
Releasing the policy document for 2014-19, Chief Minister Anandiben Patel maintained that the policy aims to make Gujarat a globally-recognised hub for the Electronics System Design and Manufacturing (ESDM) industry. The move is aimed at creating a dedicated Gujarat Electronics Mission, under which electronics hardware manufacturing will be encouraged.
For this, the policy entails series of sops in the form of subsidy for fresh investment in the clusters, interest subsidy of 7 per cent and two per cent for MSMEs and large units respectively, complete waiver of electricity duty for the initial five years with subsidised power tariff at Re 1 per unit among others. Additionally, R&D will get special encouragement with 50 per cent subsidy of the total project cost upto Rs 50 lakh.
The spokesperson of the state government Nitin Patel and Saurabh Patel informed that the new policy aims to focus on G2B - government to business. Considering the growth of electronics sector in the country, the import of electronics goods is expected to surpass that of petroleum products by 2020. Hence, the new policy takes into account these aspects and creates an environment to manufacture in India.
The state plans to create infrastructure to develop semi-conductor fabrication units. Also, the policy aims to develop green field and brown field electronics manufacturing clusters in the state.