SPOTLIGHT ON INDIAN ELECTRONICS Spotlight on Indian Electronics | Page 65

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NET ZERO IMPORTS
B2B buyers – Revenue cost Rs . 103 crore , assuming no
Ÿ
Increased employment opportunities resulting from
incremental substitution of imports by domestic production .
increase in production
Scenario 2 : Excise Duty of 2 % on domestically manufactured
Ÿ
Increase in content generation and innovation : Notebooks
finished goods with CENVAT credit of the 2 % tax to eligible
( NBs ) and PCs are expected to continue to be the primary
B2B buyers - Revenue impact Rs . 323 crore , assuming 100 %
mode of content generation and India is expected to see a
substitution of imports by domestic production .
sustained demand driven by the IT industry .
These policy interventions by the government for the IT sector
Ÿ
Enhanced competitiveness of exports of IT products from
would also have the following positive impacts :
India
Ÿ
Help in immediate import substitution
While the revenue impact is modest , the policy interventions ,
Ÿ
Increased scale of domestic manufacture of finished
particularly the fiscal benefits will go a long way in
products will attract component manufacturers to invest
encouraging domestic manufacture of these products in India ,
and establish their presence in India to meet the local
in line with the “ Make in India ” and “ Digital India ” visions of the
demand .
Government .

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' Make in India ': A significant initiative
Among the World Bank predictions that the year 2016 could
that India will continue to expand at a robust pace and boast
be a year of “ perfect storm ” for the world economy and a
of an economic growth of more than 7 %.
simultaneous slowdown in the BRICS countries , hope floats
Positive economic outlook for India ( IMF World Economic Outlook Projections : April 2016 )
The several reforms undertaken by the government have had a positive impact on the growth and investment into the country . Industry is hopeful that the progressive reforms process will continue to propel the economy .
However , there are concerns about the stagnation of the Indian manufacturing at low levels , especially when compared with the East-Asian successes . India ’ s current strong economic performance is driven more by public investments and private consumption . The other two important components of the economic growth - exports and private investments - remain weak and have been a cause of concern . The weak private investment is evidenced from the fact that capital expenditures as a share of GDP have declined further from 5.4 percent of GDP in FY 2014 to 5.2 percent of GDP in FY 2015. 2 Indian
The global economic conditions are unstable given the prospects of rising interest rates in the US and a slowdown in China . India too is facing the challenge of falling exports . With the prospect of a negative growth in exports continuing for at least one more year ,
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