IT hardware makers want Rs 20,000 crore under PLI scheme

The Manufacturers’ Association of Information Technology (MAIT) want the government to allocate Rs 20,000 crore under the production-linked incentive (PLI) scheme, to boost manufacturing of personal computers, tablets and servers in India.

The IT hardware makers body also want the government to address various disabilities that the sector faces, including improvement in export infrastructure, to support growth under the PLI scheme. Nitin Kunkolienker, MAIT President, told PTI that they are looking for higher funds for the PLI scheme. “For laptops, servers etc. the government has just proposed Rs 7,325 crore. I don’t think that, for PCs, if you relocate and reposition supply from China or other parts of the world, it will be possible with just these kinds of funds. They are very insignificant.”

Kunkolienker said the mobile phone industry got around Rs 41,000 crore where there has been sustained effort for the past 10 years to push manufacturing, and even it does not come under ITA-1 (information technology agreement). “You gave them (mobile industry) duty arbitrage earlier. There was some base created for mobile manufacturing; whereas for PC, laptop, servers and tablets, there was an inverted duty regime from 2005 to 2014 that impacted manufacturing of these products. Now, we need to reinvent,” he said.

The MAIT president pointed out that there is a need to recreate and reposition India’s market when the government is trying to get into more creative education for e-learning. “At least Rs 20,000 crore is required (under PLI). It is based on value addition potential that exists in the country. There is an immense potential for Indian MSMEs (micro, small and medium enterprises) to become part of the global manufacturing ecosystem. There is a disability in MSMEs to borrow capital.”

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Kunkolienker said India has major challenges in terms of manufacturing ecosystem, including logistics. “For real make in India to happen, there is a need to address disabilities. It won’t be possible by giving two per cent. It does not even cover up for loss of transactions. Relocating the supply chain is not an easy target,” he pointed out. “To achieve this target, you need to have an export-centric approach. Shipping lines may offer competitive rates. We support the strategy of export-led growth but export infrastructure is very uncompetitive.”

As such, the MAIT said a consolidated and integrated approach is required to facilitate investments even under the PLI schemes.