Electronics System Design and Manufacturing
Karnataka's ESDM Initiative
About ESDM
✅ 10% Contribution to National Electronics output
✅ Above 100 Fabless chip design houses and is the largest Chip Design Hub in India
✅ 40% contribution to the National share in electronic design
✅ 50% contribution to the National share in electronic product companies
Existing ESDM Clusters in Karnataka
- Lahari – A World Class Testing and Certifying Facility – Set up in the historic city of Mysuru, to provide Testing, Quality & Regulatory needs of the regional electronic industry. Lahari has the arsenal of “Advanced Technologies and methodologies” to help grow the local electronic industry, encourage new investments and new product designs. In short, Lahari is a “ONE STOP SHOP for PRODUCT DEVELOPMENT & COMPLIANCE WORK” – dedicated to ESDM.
- GoI & GoK has approved the proposal for setting of Multi-tenancy Clean Room in Mysuru. The cleanroom facility would be a crucial element in attracting compound semiconductor / OSAT / ATMP companies into the state as it would ease the investing companies’ burden of initial capital investment. It can also be stated that this model of business would also be one of the key elements for attracting the semiconductor investments into the state of Karnataka.
- Under EMC 2.0 Scheme of MeitY, 7 LoI’s worth 1300+Cr has been signed. With over 230 acres of land approved, over 1200 jobs will be facilitated in Mysuru.
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- Under EMC 2.0 Scheme of MeitY, 11 LoI’s worth 300+Cr has been signed. With over 200 acres of land approved, over 2000 jobs will be facilitated in Hubballi.
- Toy Manufacturing Cluster – Envisaged under the Product Specific Industrial Cluster Development Programme of the government of Karnataka, this is the first cluster in India dedicated for manufacturing toys. The cluster is also estimated to attract an investment of over Rs 4,000 crore and create over 25,000 direct jobs (mostly for women in North Karnataka) and over a lakh indirect job.
Policies and Schemes
Electronic Systems – India is one of the largest consumer electronics markets in Asia Pacific Region. The world’s fastest-growing industry, Electronics System Design and Manufacturing (ESDM) continues to transform lives, businesses, and economies across the globe. The Government of India attributes high priority to electronics hardware manufacturing, as it is one of the crucial pillars of Make in India, Digital India, and Start-up India programmes.
India is expected to have a digital economy of $ 1 Tn by 2025. India’s semiconductor market is expected to increase from ~$ 15 Bn in FY20 to ~$ 110 Bn in FY30, growing at a CAGR of 22%.
The Semicon India Program with an incentive outlay of ~$ 10 Bn was launched with the vision to develop a sustainable semiconductor and display ecosystem in the country. This program will establish India as global hub for semiconductor and display manufacturing, promote self-reliance, strengthen resilience in global supply chains, and pave the way for India’s technological leadership in the industry. Further details can be found here
Government of India Policies and Schemes
Government of Karnataka Policies and Schemes
Develop Karnataka into a global ESDM hub and a hotbed of innovation through focused
interventions and encouragement to local companies in the sector.
- Stimulate the growth of 2000 ESDM start-ups during the policy period.
- Enhance value addition done in Karnataka by 50%.
- Create 20 Lacs new jobs in the ESDM industry by 2025, both direct and indirect, thereby increasing the total workforce in the sector to ten times the present
number. - Effect a quantum jump in the overall revenues of Karnataka’s ESDM companies to USD 40 billion by 2025.
- Capital Investment Subsidy: 20% of eligible capital expenditure on Plant & Machinery
- Land Subsidy: 25% of expenditure on land up to an extent of 50 acres (only in districts other than Bengaluru Urban & Rural)
- Stamp Duty Reimbursement: 100%
- Registration fee reimbursement: 100%
- Reimbursement of Land conversion fee: 100%
- Incentive on Power & Electricity Duty:
- INR 1 per unit for 5 years from the month of commencement of commercial production
- 100% exemption for 5 years from the month of commencement of commercial production
- Production Linked Incentive (PLI) Scheme: 1% of annual turnover for a period of 5 years
ESDM Infrastructure
Lahari- Advanced Testing Facility
Multi Tenancy Clean Room
The Global Emerging Technology Design Center
- ✅ Two Electronics Manufacturing Cluster (EMC) are coming up in Mysuru and Hubballi in Karnataka
- ✅ In the Mysuru EMC 234 acres (1 acre=4047 sqm) land has been allocated. Government of Karnataka has received 7 Letter of Intent (LoI) from electronics manufacturing companies for setting up their operations in this EMC with a total proposed investment of over INR 1300 crore (~USD 160 mn.) and creating over 1200 direct employment.
- ✅ In the Hubballi EMC over 200 acres (1 acre = 4047 sqm) land has been allocated. Government of Karnataka has received 11 LoIs from electronics manufacturing companies for setting up their operations in this EMC with a total proposed investment of over INR 300 crore (~USD 37.5mn.) and creating over 2000 direct employment.
ESDM STRATEGIES
Talent Accelerator vertical at KDEM to develop and nurture the talent pool by refining & strengthening the existing initiatives. With focused interventions and collaboration with Department of Higher Education, Skill Development Corporation Authority, VTU, new strategy to be built for skilling and boosting employment opportunities in the state.
With effective implementation of infra policy, industry collaboration, KDEM to facilitate centre of excellences (CoEs) to provide an impetus to local industry; and encourage new investments and growth in Beyond Bengaluru clusters.
Under the Beyond Bengaluru mission, KDEM to structure and operationalize PMA policy to encourage domestic procurements; accelerate next generation technologies through pilot projects and encouragement to grass-roots entrepreneurship and IP creation.
Start-up and Innovation vertical at KDEM Strengthen the existing Semiconductor venture fund for accelerated investments; and promote expansion and growth of KESDM industry through market development activities and support to local companies.
KDEM acting as a bridge between industry and government, to Simplify and streamline policies and procedures to enhance overall experience of doing business in the state; and put in place mechanisms for faster facilitation of incentives and other policy benefits to attract investments from global companies in the sector.
