The Union Cabinet
chaired by the Prime Minister Shri Narendra Modi has given its approval
for amendment in the Modified Special Incentive Package Scheme (M-SIPS)
to further incentivize investments in Electronic Sector and moving
towards the goal of ‘ Net Zero imports’ in electronics by 2020.
Besides expediting investments into the Electronics System Design and
Manufacturing (ESDM) sector in India, the amendments in M-SIPS are
expected to create employment opportunities and reduce dependence on
imports. The projects already received under the scheme have the
potential to generate employment to the extent of upto one million
persons (direct and indirect).
The Policy covers all States and Districts and provides them an
opportunity to attract investments in electronics manufacturing. So far,
243 applications have been received under the scheme, out of which 75
applications have been approved involving investment proposals of Rs.
The salient features of the amendment are:
a) The applications will be received under the scheme upto 31st December
2018 or till such time that an incentive commitment of Rs 10,000 crore
is reached, whichever is earlier. In case the incentive commitment of Rs
10,000 crore is reached, a review will be held to decide further
b) For new approvals, the incentive under the scheme will be available
from the date of approval of a project and not from the date of receipt
c) The incentives will be available for investments made within 5 years
from the date of approval of the project.
d) Approvals will normally be accorded to eligible applications within
120 days of submission of the complete application.
e) A unit receiving incentives under the scheme, will provide an
undertaking to remain in commercial production for a period of at least
f) The Appraisal Committee recommending approval of project will be
chaired by Secretary, Ministry of Electronics and IT.
g) A separate Committee headed by Cabinet Secretary and comprising of
CEO, NITI Aayog, Secretary Expenditure and Secretary, MeitY will be set
up in respect of mega projects, envisaging more than Rs. 6850 crore
(approx. USD 1 Billion) investments.
The Cabinet had, in July, 2012 approved the M-SIPS to provide a special
incentive package to promote large scale manufacturing in the Electronic
System Design and Manufacturing (ESDM) sector. The scheme provides
subsidy for capital expenditure - 20% for investments in Special
Economic Zones (SEZs) and 25% in non-SEZs. The Scheme was amended in
August, 2015 for scope enhancement and simplification of procedure. The
Scheme has attracted investments in the ESDM sector to the tune of Rs.
1,26,838 crore, of which investments of around Rs. 17,997 crore have
been approved by the MeitY. The M-SIPS has been able to create positive
impact on investment in electronics sector.