The government today unveiled the draft National Policy on Electronics, 2011, which aims at USD 400 billion turnover in 2020 by the domestic industry and focuses on reducing imports.

Announcing the draft policy, Telecom Minister Kapil Sibal said at the current rate of growth, the "domestic production can cater to a demand of USD 100 billion in 2020 as against demand of USD 400 billion and the rest would have to be met by imports.

"This aggregates to a demand supply gap of nearly USD 300 billion by 2020. Unless the situation is corrected, it is likely that by 2020 the electronics import may far exceed oil imports," Sibal said.

One of the objectives is to achieve a turnover of about USD 400 billion by 2020 involving investment of about USD 100 billion and employment to around 28 million by 2020.

"The National Policy of Electronics-2011 envisions creating a globally competitive electronics systems design and manufacturing (ESDM) industry, including nano-electronics, to meet the country's needs and serve the international market," Sibal said.

This is a quantum jump from production level of about USD 20 billion in 2009. This interalia, includes achieving a turnover of USD 55 billion of chip design and embedded software industry, and USD 80 billion of exports.

"The final policy on electronics is expected by December. We expect to receive comments on the draft by November," the minister said.

The National Policy on Electronics is aimed at making India the hub of electronic manufacturing.

The policy proposes setting up of over 200 electronic manufacturing clusters (EMCs) and providing assistance for setting up of greenfield EMCs and upgradation of brownfield EMCs.

"I have talked to chief ministers and ministers regarding finding a place for setting up such clusters," he said.

He added that the policy will also provide incentives for setting up of over 200 electronic manufacturing clusters with the world-class logistics and infrastructure.

Another important objective of the policy is to "augumenting post-graduate eduction and to produce about 2,500 Phds annually by 2020". "For this we need tie-ups with universities and educational institutions like IITs and IIScs to promote such kind of thing," Sibal added. .

The policy will also provide attractive fiscal incentives across the value chain of electronics system design and manufacturing (ESDM) sector through modified special incentive package schemes, setting up of semiconductor wafer fabrication facilities and its ecosystem design and fabrication of chips and chip components.

The policy will also focus on using innovation and R&D capabilities to develop electronic products catering to domestic needs and conditions at affordable price points.

Further, the policy will create a 10-year stable tax regime for the ESDM sector, Communications and IT Minister Kapil Sibal said.

Besides, the policy will also look into setting up of a specialised institute for semiconductor chip design. It will also encourage greater participation of private sector in Human resource development for the sector, Sibal said.

The Electronics Policy will also have mandating standards for electronic products, specific to Indian conditions of power, climate and handling,.

It will also create a link for long term partnership between domestic ESDM industry and strategic sectors like defence, atomic energy and space.

The policy will also talk of adopting best practices in e-waste management and setting up centres of excellence in the areas of automotive electronics, avionics and industrial electronics.

The policy will also ask for setting up of National Electronic Mission with industry participation to advance the implementation of various programmes in this policy.

"The policy will also recommend a name change of the Department of Information Technology as the Department of Electronics and Information Technology to reflect the desired focus on electronics," Sibal said.

To declare mobile phones specially and other electronic products for data communications as goods of special importance under the Central Sales Tax Act.