Electronic System Design & Manufacturing, Modified Special Incentive Package Scheme(M-SIPS)

To promote large-scale manufacturing, to offset disability and to attract domestic and global investments into the Electronic System Design and Manufacturing (ESDM) sector in India, the Modified Special Incentive Package Scheme ( M-SIPS) was notified vide Notification no. 175 dated 27th July 2012 in Part-I , Section 1 of the Gazette of India.

The scheme is available for both new projects and expansion projects. The scheme provides subsidy for investments in capital expenditure - 20% for investments in SEZs and 25% in non-SEZs. It also provides for reimbursement of CVD/Excise for capital equipment for the non-SEZ units. For high technology and high capital investment units, like fabs, reimbursement of central taxes and duties is also provided.

The incentives are available for investments made in a project within a period of 10 years from the date of approval.

The incentives are available for units all across the value chain starting from raw materials including assembly, testing, packaging and accessories and covering 29 verticals of ESDM products like

Modified Special Incentive Package Scheme(M-SIPS)

i. Telecom equipments	vi. Consumer electronics	xi. Semiconductor chips & components	xvi. Nano-electronics
ii. Mobile sets and accessories	vii. Power supply for ESDM products	xii. Fabs for ESDM products	xvii. E-waste processing
iii. Opto electronics	viii. Medical electronics	xiii. LEDs/LCDs	xviii. Automotive electronics
iv. IT hardware	ix. Semiconductor wafering	xiv. Avionics	xix. Electronics manufacturing services etc.
v. Bio-metric/identity devices	x. Solar photovoltaics	xv. Electro-mechanical components

In furtherance to para 6.2 of M-SIPS policy, for effective functioning of the scheme, a set of guidelines have been drawn and made online on DeitY website. The guidelines for M-SIPS contains the detailed terms and conditions of the scheme along with the list of various ESDM verticals and the requirement of investment thresholds. It also contains application formats both for new and expansion projects. A time line regarding sanction of applications is also there and an applicant will know when to expect a response from the Government. The M-SIPS require applicants to applications with Financial Closure (tied up funds) for the project they propose to execute. The Financial Closure for a project, however, can be given in phases.

As per para 6.1 of M-SIPS notification, to consider the applications under the scheme and to submit it’s recommendations, an Appraisal Committee headed by Additional Secretary , DeitY have been constituted.

The non- refundable application fee which is required to be submitted along with the application form has been separately notified. It varies from Rs 10,000/- for projects costing less than 10 crores to Rs 1,00,000/- for projects costing 10,000 crores and above.

M-SIPS scheme is presently open to receive applications. All Initial applications which will be received by DeitY on or before 26-07-2015 will be considered for incentives under M-SIPS. The Nodal Officer is the key contact for all communications relating to M-SIPS. Nodal Officer(M-SIPS) has been appointed. All applications under M-SIPS are required to be submitted to Nodal Officer(M-SIPS), Department of Electronics and IT, Electronics Niketan, Lodhi Road, New Delhi-110003. Application can also be submitted online at www.msips.in

For more details please see http://deity.gov.in/