Incentive scheme for telecom gear to spur manufacturing, exports amid 5G build-up: Sectoral players

The government has approved a production-linked incentive (PLI) scheme for 10 key sectors, including telecom, automobiles and pharmaceuticals, taking the total outlay for such incentives to nearly Rs 2 lakh crore over a five-year period. Of this, the outlay for telecom and networking products is pegged at Rs 12,195 crore, an official release said highlighting India's aspirations to become a major manufacturing hub for these equipments, which form a critical and strategic element of secured infrastructure.

The telecom sector on Wednesday cheered the introduction of the PLI scheme worth Rs 12,195 crore, for telecom and networking equipment, which would boost manufacturing, attract component sector and industries, spur exports and create jobs at a time when India is gearing up for 5G. The government has approved a production-linked incentive (PLI) scheme for 10 key sectors, including telecom, automobiles and pharmaceuticals, taking the total outlay for such incentives to nearly Rs 2 lakh crore over a five-year period.

Of this, the outlay for telecom and networking products is pegged at Rs 12,195 crore, an official release said highlighting India's aspirations to become a major manufacturing hub for these equipments, which form a critical and strategic element of secured infrastructure. The outlay for electronics and technology products has been pegged at Rs 5,000 crore.

Telecom equipment forms a critical and strategic element of building a secured telecom infrastructure and India aspires to become a major original equipment manufacturer of telecom and networking products, the release said. The product lines that have been specified include core transmission equipment; 4G/5G, next-generation radio access network and wireless equipment; and access and customer premises equipment (CPE).

They also include internet of things (IoT) access devices and other wireless equipment; and enterprise equipment including switches and router. "Production Linked Incentive scheme worth Rs 12,195 crore for telecom equipment manufacturing will encourage Indian and global telecom equipment manufacturers to manufacture in India as well as export from India.

"India is one of the largest telecom markets in the world," Communications Minister Ravi Shankar Prasad tweeted. Industry body COAI said that the latest move reflected Government's commitment to Make In India, and to foster inclusive growth in the industry by making it faster, easier and more competitive to conduct business.

The Indian telecom industry has been "extremely resilient" during the ongoing pandemic and has played a pivotal role in supporting other sectors, especially during the COVID-19 lockdown, said Cellular Operators' Association of India (COAI) Director General S P Kochhar. While the industry is awaiting details of the incentive scheme, the sector is fully confident that scheme would be designed to ensure demand for telecom equipment from the local market is enhanced, and exports from India are suitably supported and incentivised, he added.

Ericsson India Managing Director Nitin Bansal said the scheme comes at a "very opportune time" as India is on the verge of introducing 5G in the country. "Being the first telecom vendor to start manufacturing in India, we hope that the PLI scheme will not only give a strong boost to the manufacturing industry in India, but also attract the component sector and industries for leveraging networks for enterprise, IoT and Industry 4.0," Bansal said.

TEMA Chairman Emeritus N K Goyal said the PLI announcement would encourage domestic production, exports, and create employment opportunities in the sector. "We expect increase in domestic production to the tune of Rs 2 lakh crore in five years with employment generation of one lakh, both direct and indirect," Goyal said.

Anand Agarwal, group CEO of Sterlite Technologies Ltd, said inclusion of 10 new sectors, including telecom products, under the PLI scheme "is a big step forward towards an Atmanirbhar Bharat". Agarwal added that this initiative will not only promote fresh investments but also create job opportunities. "Going forward we would urge the Government to bring more industries and products under the ambit of PLI to build domestic champions." The PLI scheme in the mobile phone manufacturing sector is already in place.

Last month, the government cleared 16 proposals from domestic and international companies entailing investment of Rs 11,000 crore under the scheme to manufacture mobile phones worth Rs 10.5 lakh crore over the next five years. The list of companies included iPhone maker Apple's contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung and Rising Star.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)