Three companies - Tejas, Tessolve and Bosch - on Monday said they will invest about Rs. 2,600 crores in electronics manufacturing projects over the next few years.
The companies are making investments under the government's special incentive scheme, M-SIPS. While Tejas Networks will invest in telecom equipment manufacturing, Tessolve Semiconductor plans to set up an assembly and testing plant. Bosch will make investments in the field of electronics as part of its ongoing plans.
"We will invest about Rs 1,700 crore in telecom equipments manufacturing. We have just got investment approved by government for first two phases of Rs 760 crore. Rest we will do in next phase," Tejas Networks MD and CEO Sanjay Nayak told PTI on sidelines of IESA Vision Summit 2015 in Bengaluru.
The company is making investments under the modified special incentive package scheme. MSIPS provides 25 percent subsidy on capital expenditure made by a domestic company in non-SEZ area, and 20 percent within the Special Economic Zones; reimbursement of countervailing duties and excise for capital equipment for non-SEZ units and reimbursement of central taxes and duties for 10 years.
"We will invest Rs. 750 crores in ATMP (assembly, testing, mark and packaging) plant over next three years," Tessolve Semiconductor Co-founder V Veerappan said.
Bosch Automotive Electronics India Managing Director Panduranga Prabhu the company has committed investment of about Rs. 500 crores in India, of which it has already invested Rs. 300 crores.
"We have gone through full cycle of investment under M-SIPS and are the first company to receive reimbursement of subsidy as promised by government. It makes sense for companies to invest in India as from here we are exporting as well. Exports contribute to about 65 percent revenue in India," Prabhu said.
Government is making efforts to reduce imports of electronic products and to meet requirement of domestic market through indigenous production.
As per an IESA-EY report, released by Karnataka Chief Minister Siddaramiah, key products made in India are 4-22 percent expensive compared to imports.
"The condition has improved a bit which means things are on right track. The disability numbers in 2015 range between 4-22 percent. In 2014, it ranged from 7-26 percent depending on extent of local value addition and depending on the product classification, ITA-1 products vs non-ITA-1 products," IESA chairman Ashok Chandak said.
Government's decision to give preference to domestically made electronics product, reduction of excise duty, raising basic custom duty on non-ITA 1 products, smart cities and Digital India project have improved case for manufacturing in India, he added.
"We have asked government to grant deemed export status to domestically manufactured ITA 1 products, extend preferential market access to more product category, quick clearance of components on ports required for manufacturing as some of the ways to further reduce disability factor," Chandak said.