MAKE IN INDIA-TELECOM Keynote Presentation on Budget Issues By NK Goyal, Chairman Emeritus TEMA President CMAI, Vice Chairman ITU APT Chairman, ITPS Dubai Member, Governing Board Telecom Equipment and Services Export Promotion Council (Govt. of India) Before Ministry of Communications & IT, Govt. of India December,

Compliments NDA Govt. committed for Make in India 27 th December, Govt. announced preferential purchase of indigenous manufactured products by Govt. Departments Ease of Doing Initiatives of Govt. Govt. realization of crucial Centre-State interaction Telecom/ICT in boom and receiving Govt. focus

Presentation About Association Where we are? Make in India Budget Innovations

ABOUT ASSOCIATION

CES, 2009 being inaugurated and ribbon cutting at Las Vegas on 8th January, 2009 by NK Goyal with Sir Howard Stringer, Chairman & CEO of Sony Corporation, Mr. Tom Hanks, the American movie star, Mr.Gary Yacoubian, Chairman CEA & President of Myer-Emco AudioVideo, Mr. Gary Saprio, Vice President of CEA, Ms. Qu., Presixdent, CECC China, Mr. Patrick Lavelle, President and CEO of Audiovox, Mr. Peter Lesser, President and CEO of X-10 (USA) Inc, Mr. Loyd Ivey, Chairman and CEO of MiTek Electronics and Communications, Mr. Jay McLellan, President and CEO of Home Automation, Inc. (HAI), Mr. Mike Mohr, President of Celluphone, Mr.Grant Russell, President of Kleen Concepts

TEMA CMAI TEMA- the only association promoting focused approach for telecom equipment manufacturing since 1994 CMAI- the focused association for promotion of entire sector of ICT-electronics, telecom, mobile, Cyber Security, multimedia, convergence, applications in education/health etc. 54 Worldwide MOU partners Known for technical standards, testing, PSUs Procurement manual

WHERE WE ARE? Telecom/ICT policy initiatives taken by DeITY and DOT. DOT Member Production post vacant for several years DOT – a development origination, committed for development of indigenous manufacturing of telecom equipments. ITA 1- Not only Duty free, but without any standard/testing/security clearances Wholly dependent on Imports-likely to be soon more than Oil Bill Negligible Base in India

Make in India- Some Request PMA announced for Govt. Need to be extended to private sector. To address issue of Govt. Departments asking foreign approval/restricting criteria for procurements. To address issue of criteria of Past experience for new startups/innovation companies To address issue of trial spectrum IND 55 for evaluation and trials Need to make standards mandatory by TEC Need to make testing mandatory by TEC Need to implement security Clearances for all equipments Need to address issue of PSUCs pricing dilemma for new start ups and innovations. Need to address PSUs- procurement delays due to false & vested complaints

BUDGET ISSUES ) Grant of Infrastructure Status : Grant of Infrastructure status to the domestic telecom equipment manufacturing companies complying with PMA provisions will help the industry to take benefits of the incentives given to the infrastructure sector.

BUDGET ISSUES- 2 2) Tax Holidays: The domestic telecom companies manufacturing products covered under PMA provisions may be considered for a tax holiday of 10 years, similar to the incentives extended to Power generation companies.

BUDGET ISSUES-3 3) Levy duties on non-ITA products: We welcome the initiatives taken by the Government to levy duties on non-ITA products in the last Union Budget for the FY , where some of the telecom products have been brought under the duty regime, to boost the domestic manufacturing of these products in the Country. In this regard we would like to bring to your notice that there are many telecom / ICT products which are somehow being imported into the Country under ‘OTHERS’ category.

BUDGET ISSUES-4 4) Removal of Inverted Duties: Inverted duties are one of the reasons for making imports more attractive than manufacturing. In order to overcome this disability, it is our humble submission that Customs Duty, CVD and SAD may considered to be removed from the import of the components which are being used in the manufacturing of IT & telecom products. This will help to create a level playing field for the domestically manufactured products

BUDGET ISSUES 5 5) Deferred Payment of Excise Duty: Domestic telecom equipment manufacturing companies complying with the PMA provisions should be provided with the deferred payment of Excise duty on such equipments on an interest free basis for a period of 5 years. When the GST gets implemented the corresponding benefits may also be extended in that regime to domestic telecom equipment manufacturers.

BUDGET ISSUES-6 6) R&D support for technology development : R&D and IPR creation are critical factors for strengthening the manufacturing sector in the country. In order to encourage more R&D in the sector, we propose to introduce 5 % cess on user of telecom services (service providers) to create a corpus for supporting R&D for technology development in telecom sector.

BUDGET ISSUES- 7 7) Minimum Alternate Tax (MAT). There is high capital intensive investment is required for setting up the telecom / ICT manufacturing units. In order to encourage more manufacturing units to come up in the country, it is our request that Minimum Alternate Tax (MAT) may fully exempted for the domestic telecom equipment manufacturing units, which are complying with the PMA provisions.

INNOVATION Innovation is a process of taking new ideas to satisfied customers. it is the conversion of new knowledge into new products and services. Innovation differs from Invention or renovation in that innovation generally signifies a substantial positive change compared to incremental changes. Frugal Innovation- increasingly fashionable concept, refers to No frills reduced complexity, designing for durable, quality goods at most economical rates, by using available materials for new and overlooked markets, commonly called in India jugaad, but actually meaning inclusive innovation, catalytic innovation, reverse innovation etc.

RADICAL INNOVATIONS INCREMENTAL INNOVATIONS

Indian Market GUESS WHAT IS MOST STRATEGIC MARKET FUNDAMENTALS IN INDIAN MARKET?

DISSAPPOINTMENT IN INDIA

NEEDED POLICY INITIATIVES TO PROMOTE INNOVATIONS

Great Indian Opportunity THANKS…. Great Indian Opportunity