(MENAFN- KNN India) With an estimated $4 billion (Rs 25,000 crore) worth of Personal Computer (PC) manufacturing capacity lying idle in the country, large manufacturers say the industry needs a long-term policy road map from the government for them to consider manufacturing in India.
While the Modi government offers special incentives for companies to manufacture smartphones and tablets in India, makers of personal computers say various issues like compulsory BIS (Bureau of Indian Standards) certification for components are actually making it tougher for them to do business in the country.
According to new rules set by the government, power adapters and batteries also require BIS certification, which was previously required only for an entire product. This may make foreign sourcing of components difficult, time consuming and costly.
Indian Manufacturers of PCs are already facing a tough competition from imports. IT products manufactured in India are valued at $1.3 billion whereas the market is valued at $5.8 billion, in other words, two-third of the demand is met by imports.
Manufacturing in India can double local manufacturing in the first year itself as companies have idle capacity according to MAIT, the apex body of hardware industry.
The finance minister's announcement to exempt components used in the manufacture of ITA (information technology agreement) products from special additional duty has been welcomed by the Industry but they are looking for a comprehensive policy to promote domestic manufacturing of PCs.
India is ideally located for being a manufacturing hub for the Middle East, South East Asia. But the policy needs to have vision, clarity, stability and it needs to be realistic € according to an industry insider. Though the recently announced Foreign Trade Policy provided some incentive to IT products, it is insufficient to shift large-scale manufacturing for the sector. Reverting it to the previous incentive structure of 5% has the potential to see changes in the global supply chain - he said. (KNN/DB)
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