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Andhra Pradesh plans mega electronics manufacturing hub

September 11, 2014 12:06 IST

Andhra Pradesh Chief Minister N Chandrababu Naidu, who was instrumental in developing Hyderabad as a key information technology services destination in the country, is now embarking upon a mission to establish the state as an electronics manufacturing hub.

In what is seen as a timely plan in sync with Prime Minister Narendra Modi’s ‘make in India’ focus, the Andhra Pradesh Electronics Policy 2014-20 envisages setting up of a mega electronics hub, an electronics hardware park and associated common facilities by taking the private sector on board. It also envisions developing the “electronics industry as an important growth engine for Andhra Pradesh through effective use of the talent pool”. 

In his maiden Independence Day speech on August 15, PM Modi had called for developing the country as a manufacturing destination of choice. He had appealed to investors to “come, make in India”. 

Andhra Pradesh aims to attract $5 billion worth of investment in electronics systems design and manufacturing (ESDM) by 2020 and generate employment for 400,000 people. For this, it will tap into the skills of around 200,000 engineering graduates each year. 

The plan is expected to solidify Naidu’s stature as an information technology (IT) reformer in the divided Andhra Pradesh, adding a gloss to his pro-technology and pro-industry image. 

Adopting and promoting the National Policy on Electronics (NPE), 2012, the state has lined up fiscal and non-fiscal incentives to achieve its mission. 

These include granting permission for three-shift operations, with women working in night shifts, on the lines of the IT/IT-enabled services industry; according an essential services tag to the sector under the Andhra Pradesh Essential Services Maintenance Act; and mooting an empowered consultative committee on the IT industry with representatives from the electronics industry. The panel will administer incentives in a speedy, time-bound and transparent manner. 

Besides, an empowered mission stationed at Visakhapatnam and headed by a technocrat with three experts will assist in marketing and promotion. The thrust areas are fables semiconductors, mobile, light-emitting diode (LED), smart meters, televisions, tablet computers, base stations, smart cards, sensors and the internet-of-things. 

Fiscal incentives

The key fiscal incentives include 100 per cent reimbursement of stamp duty, transfer duty and registration fee on sale and lease deeds for the first transaction and 50 per cent thereof on the next. The cost of filing patents will be reimbursed to companies having headquarters in Andhra Pradesh, subject to a limit of Rs 5 lakh per domestic patent and Rs 10 lakh for an international one. 

It will also offer 50 per cent reimbursement of the cost involved in skill upgrade of local manpower, limited to Rs 2,000 per person. There will be a special dispensation to mega projects entailing an investment of Rs 250 crore. The policy document mentions the state has a "competitive advantage in terms of relatively low land cost when compared with Hyderabad, Chennai and Bangalore". 

An Information Technology and Investment Region (ITIR) will come up in Visakhapatnam and two reserve clusters for electronics hubs. Kakinada will house the electronics hardware park. 

For smoother logistics, the state will rely on the Visakhapatnam-Chennai industrial corridor. It is already in the process of expansion and modernisation of airports in Visakhapatnam and Tirupati. 

A Centre for Excellence in the design of fables semiconductors in partnership with industry and academic institutes also forms part of the mission.

THE LEGACY

1995-2004

Naidu’s first term as CM of united Andhra Pradesh

Key works

Nov 1998

Establishes CyberTowers, the first phase of HitecCity

2000

Sets up Cyberabad, straddling HitecCity, 13 adjoining villages

Jan 2003

Holds Hyderabad International Trade Expositions; brings global and Indian majors like Microsoft, Dell, Oracle, Computer Associates, Convergys, Motorola, Nokia, Infosys, TCS, Satyam, Wipro, GE Capital and Baan to Hyderabad

N Madhav in Hyderabad
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