The Union Cabinet has sanctioned the National Policy on Electronics 2019 (NPE 2019). Originated by the Ministry of Electronics and Information Technology (MeitY), the new policy seeks to transform India into a worldwide hub for Electronics System Design and Manufacturing (ESDM). The end goal is to enhance the nation’s capacities in generating core components, such as chipsets, and create an environment that will allow the industry to compete on a global level.
Historical Background
The groundwork for a competitive Indian ESDM value chain was laid under the leadership of the National Policy on Electronics 2012 (NPE 2012). The schemes and programs implemented under the supervision of this policy have been instrumental in consolidating the foundation. Replacing its predecessor, NPE 2019 aims to build upon that groundwork to stimulate the growth of the country’s ESDM industry.
Key Features of the NPE 2019
NPE 2019 puts forward a comprehensive plan that includes the promotion of domestic manufacturing and export across the entire electronics system value-chain, thus creating a globally competitive ESDM sector. It also incorporates providing incentives and support for manufacturing of core electronic components and formulating appropriate schemes to encourage new units and expansion of existing ones.
Furthermore, it advocates Industry-led R&D and innovation in all sub-sectors of electronics, including nascent stage Startups in technology areas such as IoT/Sensors, 5G, AI, VR, Drones, Robotics, etc. Re-skilling and improving the availability of skilled manpower are also on the agenda. The policy will give special impetus to the Fabless Chip Design Industry, Automotive Electronics Industry, Medical Electronic Devices Industry, and Power Electronics for Mobility and Strategic Electronics Industry.
Among the key features is the creation of the Sovereign Patent Fund (SPF) to spur the cultivation and acquisition of Intellectual Properties in the ESDM sector. It also plans to bolster national cyber-security profile through promoted trusted electronics value chain initiatives.
About the Sovereign Patent Fund
As an integral part of the new policy, the Sovereign Patent Fund is a state-led investment tool designed to acquire significant IP assets to help achieve national economic objectives. Primarily seen in countries such as South Korea, France, Taiwan, Japan, and China, SPFs have only emerged in the past five years.
Facts about National Policy on Electronics 2019
| Policy | Goal |
|---|---|
| National Policy on Electronics 2019 | Develop India as a global hub for ESDM |
| Domestic Manufacturing and Export in ESDM | USD 400 billion turnover by 2025 |
| Mobile Handsets Production | 1.0 billion mobile handsets by 2025 |
Implementation Strategy and Targets
Through the new policy, several schemes, initiatives, projects, and measures for the development of the ESDM sector in the country will be formulated according to the roadmap it outlines. The policy targets domestic manufacturing and export in the entire ESDM value-chain for economic growth. The aim is to reach a turnover of USD 400 billion by 2025, including the targeted production of 1.0 billion mobile handsets, valued at USD 190 billion.
Anticipated Impact of NPE 2019
Upon implementation, NPE 2019 will institute several schemes, initiatives, and projects for the development of the ESDM sector in the country, in association with the relevant Ministries/Departments. Consequently, this will stimulate the investment flow and technology transfer, leading to a higher value addition in domestically manufactured electronic products. Thereby, it will enhance the electronics hardware production in the country and boost their export while creating substantial employment opportunities.