“The idea is to take up projects in Brownfield EMCs, which could provide greater competitiveness to existing units”

Dr. Ajay Kumarjoint secretary, DeitY

Dr. Ajay Kumar
joint secretary, DeitY

May  2013 There is increasing awareness about the opportunities in the ESDM sector. About a year back, most people had doubts if India could become a competitive destination to do electronics design and manufacturing. When the Government came out with new policy initiatives, there was lack of awareness regarding the initiatives.

Now both of that seem to be changing. While the level of awareness of opportunities and incentives remains low amongst those not directly connected to the electronics sector, we find that those who are part of the electronics sector are becoming increasingly aware of the opportunities. Companies are evaluating what projects they should take up to take advantage of the policies. Applications under MSIPS keep coming.

The gross investment in the proposed applications has crossed Rs 4500 Crores. The investments proposed in Electronic Manufacturing Clusters are now nearly Rs 2100 Crores. And all this in about four months after the policy notifications. These numbers need to be seen in light of existing manufacturing asset base.

During the four months, we have received MSIPS proposal which constitute nearly one-fourth of existing asset base for electronics manufacturing in the country. One question which is asked is what is there for the existing players under the new policy initiatives. The MSIPS and EMC scheme are primarily targeted towards fresh investment.

While it is correct that MSIPS is targeted towards fresh investment, the assistance under Brownfield EMC scheme is expected to help existing units also. Besides, the policy to provide preference to domestically manufactured electronic goods, the export incentives under the Focus Product Scheme/ Focus Market Scheme, the proposed incentives for training in electronics are all expected to benefit the existing units also.

While we have received proposals under Greenfield Electronic Manufacturing Clusters Scheme, I find there is need to break the ice in forming projects under Brownfield Electronic Manufacturing Clusters. Industry associations need to play a proactive role in this regard. It may be professional help, in the form of consultants could help. If so, please do engage consultants.

The idea is to take up projects in Brownfield EMCs, which could provide greater competitiveness to existing units. It could be common testing facility, tooling facility, packaging facility, skilling facility, logistics, which could help achieve economies of scale and thereby reduce their cost of operations. It could be a common power back up infrastructure which could reduce the cost of the units.

The units know best what they need. All that is required it an agency that can convert it into an appropriate project proposal. I hope industry associations will step in and fill the gap.

Human resource development is area where the proposals are in advanced stages and hopefully this quarter should see most of them get approved. The PhD Scheme, the vocational training scheme and the Electronics and ICT Academies scheme are all under advanced stage of Government consideration. Both Electronics and Telecom Sectors Skills Council have made significant progress.

I hope that the first courses recognized by the Councils would be announced shortly so that their work in true earnest starts. Delhi University has shown interest in setting up an Electronics and ICT Academy as well as setting up of Electronics Incubator. Other Universities are also welcome to take up similar initiatives. Best wishes for a happy summer vacations.

Dr. Ajay Kumar is also the chief editor of DietY’s electronic e-newsletter from where this article has been extracted.

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