Electronics Manufacturing Industry is one of the largest & fastest growing industries in the world with a size of USD 1.75 Trillion and is expected to reach USD 2.4 trillion by 2020. The demand in the Indian Electronics Market alone is expected to reach USD 400 billion by 2020. With the present growth rate, India can manufacture goods required worth USD 100 billion only. To address the gap of supply & demand, Government of India has set a vision to transform India into a global hub for ESDM sector to cater both domestic and global demand.
Sector has attracted strong investments in the form of M&As and other FDI inflows; Companies are set to augment investments in production, distribution and R&D in the next few years; Government has received investment proposals for USD17.5 million for which they intend to provide incentives under M-SIPS scheme. Applications received before July, 2020 will be considered.
Policy support: 100 per cent FDI allowed in the electronics hardware manufacturing sector under the automatic route; Initiatives like Modified Special Incentive Package Scheme (M-SIPS) will provide a capex subsidy of 20 – 25 per cent; As per Make in India Initiative, Electronic Development Fund Policy has been approved to rationalise an inverted duty structure; Focus on local manufacturing and design LED growth of the ESDM sector, the IESA provided a budgetary support of USD110 million through schemes.
Market size: India's gross domestic product (GDP) grew by 6.3 per cent in July-September 2017 quarter as per the Central Statistics Organisation (CSO). Corporate earnings in India are expected to grow by over 20 per cent in FY 2017-18 supported by normalisation of profits, especially in sectors like automobiles and banks.
The tax collection figures between April-June 2017 Quarter show an increase in Net Indirect taxes by 30.8 per cent and an increase in Net Direct Taxes by 24.79 per cent year-on-year, indicating a steady trend of healthy growth. The total number of e-filed Income Tax Returns rose 21 per cent year-on-year to 42.1 million in 2016-17 (till 28.02.17), whereas the number of e-returns processed during the same period stood at 43 million.