Govt focusing on boosting electronic component manufacturing; new scheme in works: MeitY

The government's focus is now on boosting electronics component manufacturing in the country and new scheme for the same is in works, a senior government official said on Monday.

Speaking at the CII Electronic Summit, S Krishnan, Secretary, Ministry of Electronics and IT (MeitY), said that 99% local mobile phone market is being met through domestic manufacturing, and for the next phase of growth companies need to export by improving competitiveness and enhancing value addition.

"If our competitiveness needs to keep getting better then the challenge really is to not just rely on about 10% to 15% of the value addition to assembly units in the country but to look at what else we can do, how can we move up in the value chain?" Krishnan said.

He said no one country is ever going to own the entire value chain and it's only going to be a portion of the value chain that India needs to target.

"Probably in India's case, the best case will probably be China which has about 40% to 45% of the entire value chain, which is manufactured in China. We could possibly think of about somewhere in the same region of 35% to 40% of the entire value chain," Krishnan said.

He said that the government is working on a second version of the incentive scheme for the electronics component—Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS).

"Earlier MSIPS (modified special incentive package scheme) was launched. Now SPECS 1.0 has been implemented for components. We are working on next SPECS... That will be done after taking issues of electronics industry into consideration," Krishnan said.

He said that the industry should also look at producing capital equipment required for electronics manufacturing locally.

MeitY secretary said that the government is also revising schemes for research and development promotion and is looking forward to engaging with industry on the same.