IAMAI offers to assist electronic goods manufacturers to relocate in India

NEW DELHI: The industrial body Internet and Mobile Association of India (IAMAI) aims at leveraging its international partners for the helpdesk it launched recently to vigorously promote the enabling policies that the Government of India has announced in overseas markets such as East Asia, Europe, and the USA with a view to establishing India as a preferred destination of investment in electronics manufacturing.

The IAMAI had launched the international helpdesk on June 17 for electronics goods manufacturers seeking to relocate their production bases in India.

The IAMAI as the industry representative of the digital services sector in India has always been actively engaged in promoting the overall digital sector in the country.

The outreach program will seek to amplify the policy packages to help create a buzz around India as the preferred destination for investment through Indian and International agencies such as Invest India, Indian Embassies, Japan, Korea Trade, etc.

IAMAI also recognizes that some investors perceive India to be a difficult market for investments on account of variations in language, the two-tiered federal structure, compliance, and obligations under federal laws, taxation, and customs clearances.

The association understands that global firms will require a deeper level of handholding through various issues in the course of their relocation; from the initiation of the investment decision to the actual settlement at a location of their choice and convenience.

Dr. Subho Ray, president, IAMAI said, “Investment in the manufacturing sector is based on one hand in transparency and robustness of policies which the government has provided in case of electronics manufacturing. On the other hand, there is a need for on-ground support and hand-holding leading to trust-building with individual firms, which IAMAI seeks to enable via the helpdesk.”

This announcement comes on the heels of three major schemes launched by the Ministry.

As a part of our recent line of activities pertaining to digital manufacturing, IAMAI is pleased to announce the launch of a Helpdesk for promoting electronics goods manufacturers in India.

This helpdesk is designed to complement the recent policy initiatives announced by the Government pertaining to the Production-Linked Incentive (PLI) Scheme, for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) and Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme – to boost the electronics manufacturing sector.

These three policies can be accessed through https://meity.gov.in/esdm/pli, https://meity.gov.in/esdm/SPECS and https://meity.gov.in/esdm/emc2.0.

According to the press communiqué released by IAMAI, these policies echo the maxim “Vocal for Local” as espoused by the Prime Minister Narendra Modi for a stronger and more self-reliant Indian economy. Electronics imports account for almost 11% of total imports in India and are evaluated at INR 4 Trillion as in October 2019.

The association understands that global firms will require a level of handholding through various issues in course of their relocation, from the initiation of the investment decision to actual settlement at a location of their choice and convenience.

“Therefore, the IAMAI helpdesk will hand-hold investors and help them navigate through the entire process of setting up businesses in India by helping in capacity building that would include awareness of schemes, regulations, and compliances; understanding the institutional mechanisms involved in course of establishing a manufacturing base in India; developing relationship with states and local authorities; developing local tie-ups for downstream ancillary supplies and upmarket disbursement mechanisms, to name a few,” said Sanjay Jha, Assistant Vice President-Policy Advocacy, IAMAI.

A vibrant domestic electronics manufacturing sector can not only help India reduce import dependency and become self-reliant, but has the potential of emerging as a major export revenue earner for the country. IAMAI extends its full co-operation to the government in this endeavor and the helpdesk is an effort to complement the initiative.

It is well recognized that good intentions and favorable policies do not always translate directly to higher investments. The government agencies are not well-equipped to hand-hold individual firms,  promote incentives overseas; and manufacturing investments are very difficult to relocate on account of time and effort. Therefore, considerable additional efforts are required to build trust and convince global manufacturing firms to actually make the call to invest in a new location. The IAMAI helpdesk seeks to address these issues via a two-pronged approach.

Currently, India produces USD100billion electronics approx. against market demands of USD 400 billion. The demand-supply gap is currently being fulfilled by importing electronics mainly from China and then other markets. In the last five years, India has improved its infrastructure, skills, and position in ease of doing business globally to attract investment in manufacturing. Government of India has also taken major remedies to address disabilities and has liberalized the regulations around manufacturing e.g.- 100% FDI in manufacturing, GST, flexible Labor Laws, improved logistic infrastructure, creating manufacturing plug and play facilities, developing SEZs, parks, and clusters for global manufacturers willing to shift India.