S. No.

Particulars

SPECS

EMC 2.0

PLI

1

Applicability

·            The Scheme is available for setting up new unit or undertaking substantial expansion (capacity increase / modernization / diversification) of existing units for electronic components and semiconductors as listed in the Scheme.

·            The Scheme is not eligible for units availing Modified Special Incentive Package Scheme (MSIPS) i.e. predecessor of this scheme.

·            The Scheme is available for setting up electronics clusters and Common Facility Centers (‘CFC’) for such electronics clusters.

·            Project Implementation Agency (‘PIA’) will prepare a feasibility study report regarding the need of infrastructure and facilities required for EMC project.

·            Anchor Unit (‘AU’), being the electronics manufacturing companies, need to provide following commitment:

o      Purchase / lease of land in the proposed EMC project – 20 percent of total land

o      Investment – Rs. 300 Crore or more

·            The Scheme is available to companies engaged in manufacturing of mobile phones and specified electronic components (printed circuit board, sensors, actuators, etc.) in India.

·            The Scheme will be available to manufacturers and contract manufacturers (as per FDI Policy Circular of 2017) subject to fulfill the following conditions:

(*The eligible unit needs to fulfil the investment criteria and incremental sales criteria over 4 year period subject to minimum investment each year.)

·            The eligibility under this Scheme, will not affect eligibility under any other Scheme.

2

Incentive

·            25 percent of capital expenditure subject to minimum investment (ranging from Rs. 5 Crore to Rs. 1000 Crore depending on category of product).

·            The capital expenditure will include following:

o      New plant and machinery, equipment, associated utilities and technology, including for Research and Development; and

o      20 percent of total capital expenditure can comprise of refurbished plant and machinery (imported / domestic)

·            The eligible unit must remain in commercial production for a period 3 years from commencement of production or 1 year from date of receipt of last incentive, whichever is later.

·            EMC Project – 50 percent of project cost subject to ceiling of Rs. 70 Crore for every 100 acres of land (for larger areas, proportionate ceiling would apply, upto maximum of Rs. 350 Crore).

·            CFC Project – 75 percent of project cost subject to ceiling of Rs. 75 Crore.

·            4 to 6 percent on incremental sales (i.e. over and above of sales turnover for Financial Year (‘FY’) 2019-20).

·            The incentive will be available for a period of 5 years from the date of the Scheme (i.e. till FY 2024-25). Hence, if an eligible unit makes an investment in FY 2021-22, then the benefit under the Scheme will be available for the balance years only (till FY 2024-25).

(MEIT is expected to disburse benefit amounting to Rs. 40,951 Crore in 5 years. Each Company will be entitled for the incentive subject to ceiling as decided by the Empowered Committee (‘EC’).)

3

Registration process and other relevant conditions

·            The application can be filed within 3 years (i.e. till March 31, 2023).

·            Incentive will be available for investment made within 5 years from the date of filing application.

·            The application needs to filed separately for each phase. Further, separate application needs to be filed for each location.

·            The application needs to be submitted by the State Government or notified agencies on behalf of AU / PIA to Project Management Agency (‘PMA’), an autonomous body of Ministry of Electronics and Information Technology.

·            The application also need to consist of roles and responsibilities of PIA and AU.

·            The application can be made within 3 years (i.e. till March 31, 2023). Thereafter, funds will be disbursed within 5 years to the approved projects. The funds will be released in 3 installments:

o      30 percent on approval of project;

o      40 percent on achievement of infrastructure milestone and allotment of land to AU; and

o      30 percent on completion of project.

·            The eligible unit needs to register online within 4 months of the Scheme (i.e. on or before July 31, 2020), which may be extended.

·            Incentive under the Scheme is applicable from August 1, 2020.