Electronics Sector Current Affairs

Union Government plans to invest Rs.2,200 crore in electronic technology start-ups

The Union Government is targeting an investment of about Rs. 2,200 crore in start-ups working on new technologies in the electronic sector under the Electronics Development Fund (EDF) by 2019.

This investment aims at creating an eco-system to make India a global hub for electronics manufacturing. Earlier, Government had approved Rs.681 crore as seed capital for building a total corpus of over Rs 6,800 crore under the EDF meant to support entrepreneurship and innovation in electronics and IT.

About Electronics Development Fund (EDF)

  • EDF is the mother fund or fund of funds that will contribute to various funds for those who invest the money in companies for creation of intellectual property rights (IPR) in the field of electronics and IT.
  • It works with venture capitalists to create funds, known as ‘daughter funds,’ which provide risk capital to companies developing new technologies in the area of nano-electronics, electronics and IT.
  • It will help attract angel funds, venture funds and seed funds towards research & development (R&D) and innovation in the specified areas.
  • It will also help to create a battery of Fund Managers and Daughter funds who will be seeking good start-ups (potential winners) and selecting them based on professional considerations.

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IT Ministry urges tax incentives for PC manufacturers too

The Ministry of Electronics and Information Technology (MeitY) in its key recommendations for Union Budget 2017-18, has suggested differential excise duty regime and tax exemptions to be expanded to personal computers and servers.

Ministry’s suggestions were as per the Phased Manufacturing Roadmap, it had worked out in consultation with the NITI Aayog.

Recommendations for Budget
  • Retain differential excise duty regime and tax exemptions granted for the manufacture of mobile handsets and tablets, under the impending GST regime, to boost domestic manufacturing of electronic products.
  • The current differential duty makes imports of mobile handsets more expensive compared with making them locally, encouraging smartphone players to set up manufacturing units in India.
  • Specified capital goods for the manufacture of electronic goods be exempted from basic customs duty and countervailing duties to increase the competitiveness of the Indian electronics Industry.
  • Specified key raw materials and inputs for the boosting manufacture of LCD and LED panels should be permitted at 0% customs duty.
  • Extension of income tax benefit for research and development (R&D) to software products and the chip design industry. The proposal is expected to boost the generation of intellectual property in the country.

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