Manufacturing of

Internet of Things
Sensors

Electronics & Hardware

Government of Gujarat
Contents

Project Concept 3
Market Potential 4
Growth Drivers 6
Gujarat – Competitive Advantage 8
Project Information 9
- Location/ Size
- Infrastructure Availability/ Connectivity
- Raw Material/ Manpower
- Key Players/ Machinery Suppliers
- Potential Collaboration Opportunities
- Key Considerations
Project Financials 12
Approvals & Incentives 15
Key Department Contacts 18

Page 2
Project Concept

What are IoT sensors?

 IoT combines connectivity with sensors, devices and people, enabling a form of free-flowing
conversation between man and machine, software and hardware.
 Sensors measure characteristics of physical objects and then convert this information into a
signal. With the growing Internet of Things (IoT) dominance, sensors are playing a pivotal role in
enabling communication between devices over the Internet.
 Sensors are being embedded into numerous IoT applications ranging from electricity, networks,
infrastructure, to mobile, wearable, home automation and security devices.
 By IoT sensor type, the market primarily includes accelerometers, gyroscopes, magnetometers,
pressure sensors, temperature sensors and light sensors.

The building blocks of IoT

IoT comes to life when its multiple building blocks simultaneously operate and communicate with
each other:

Application  Collaboration involving people, applications and

and user
business processes
interaction
 Computing systems/platforms such as enterprise
and cloud with real-time processing and data
Cloud Server
analytics capacity, storage and content delivery,
application hosting

Network  Internet access: wireless/wired, Wi-Fi, Bluetooth,

(connectivity) ZigBee, VPN, Cellular 2G/3G/4G

 Communication standards and protocols that enable

Gateway connectivity down to the sensors and up to the
network

 Objects are equipped with sensors and actuators

and thus given the ability to emit, accept and
Physical process signals
objects and  Sensors - Convert information from the physical
devices environment into a signal
 Actuators - Act on the signal from the sensors and
convert it into output

Page 3
Project Concept

Comparison of Popular IoT Technologies

Page 4
Project Concept

IoT Sensor Design Example

 16-bit Cortex-M3 microcontroller, Bluetooth Low-Energy, ZigBee and 6LoWPAN wireless protocols
in 2.4 Ghz ISM Band
 Various sensors including temperature, humidity, pressure, an accelerometer, a gyroscope and a
magnetometer.

Page 5
Project Concept

Global market overview - Sensors

 The global IoT sensors market is forecasted to grow at
a CAGR of 24.3% during 2014-23 to reach US$34.7 Global IoT sensors
billion by 2023. The growth is being driven by rising market, US$ billion
demand for smart consumer appliances (such as smart
TVs) along with growing consumer electronics market
in emerging economies. Consumer electronics was the 35
largest contributor to the global market in 2014.
 Furthermore, growing IoT applications in the
automotive and industrial markets are expected to 5
drive the market during the forecast period.
2014 2023 F
 By geography, while North America and Europe
accounted for more than 60% of the market in 2014, Source: Transparency market research
Asia Pacific is expected to be the fastest growing region
during the forecast period.
 Temperature sensors acquired the largest share of the market in 2014, driven by its diverse
applications spanning wearable devices (for fitness and monitoring health), smart homes and
industrial use cases (for monitoring weather changes).

Indian market overview - Sensors

 The sensor industry in India was valued at US$0.11 billion Indian sensors
in 2015, growing from US$0.09 billion in 2013 at a CAGR market, US$ million
of 6%, driven by rising demand for IoT-connected devices
across verticals.
 Indian sensors market, one of the fastest growing markets 145
in Asia Pacific, is expected to witness tremendous growth 104 110
on account of rising sensor content in automotive and
consumer electronic products, growing need for
automation in industries and increasing security concerns.
 The market is dominated by major global sensor players, 2014 2015 2020 F
which operate in the country through subsidiaries and
Source: EY analysis
design centers. In 2014, STMicroelectronics held the
largest share in the country’s sensors market.

Page 6
Market Potential

Global sensor market outlook, by application

 The growing use of IoT-connected devices
and applications is expected to drive the Global sensor market
global market for sensors to reach US$46 (US$46 billion, 2017 F)
billion in 2017, growing at a CAGR of 9%
2% 2% Mobile
during 2014-17.
 The mobile sensor market should continue 7% Automotive
to expand due to the increasing number of 8%
sensors being fitted in smartphones, while Medical
demand for automotive sensors is likely to 49% Security
rise driven by wider use of electronic parts. 16%
Consumer
Pressure sensors Temperature sensors Others
17%

11% CAGR 7% CAGR during PC/Storage

during 2014-17 to 2014-17 to reach
reach US$1.43 US$399 million in Source: Gartner, Woori I&S Research Center

billion in 2017 2017

Automotive market: key area for sensors

Global automotive sensor market, US$ billion

39 43
32 36
26 29
24

2015 2016 F 2017 F 2018 F 2019 F 2020 F 2021 F

Source: BCC Research and RBC Capital Markets estimates

 The automotive sensor market was valued at around US$23 billion in 2015 and is expected to
grow at a CAGR of 10% through 2021, driven by increased emission standards (such as Euro 6
in Europe that requires 56% reduction in nitrogen oxides emissions for diesel engines),
technological advancements aimed at improving fuel economy and increasing safety mandates.
 On an average, 150 sensors are integrated within the luxury passenger cars in developed
countries. The latest technologies such as connected car and data-centric traffic management,
and growing demand of electric and hybrid vehicles is expected to drive the automotive sensor
market during the next few years.

Page 7
Market Potential

Industrial sensors outlook Medical sensors outlook

Global industrial sensor market, Global medical sensor market,
US$ billion US$ billion

11.2 15.0

8.2
3.8

2014 2019 F 2015 2022 F

Source: Technavio Source: Research and Markets

 The global industrial sensors market is  The sensors market in medical

forecasted to grow at a CAGR of 24% applications is experiencing growth due to
during 2014-19 owing to growing several factors such as the increasing
applications in wireless technologies. demand from the healthcare sector for
These are widely used in the oil and gas, improved care, rising market penetration
power and utility, mining, and food and rates of portable medical devices and
beverage industries. uptake of remote patient monitoring.

Mobile sensors outlook Security sensors outlook

Global mobile sensor market, Global security sensor market,

US$ billion US$ billion

22.4 3.7
17.7 2.5

2014 2017 F 2014 2017 F

Source: Gartner, Isuppli, Woori I&S Research Center Source: Gartner, Isuppli, Woori I&S Research Center

 As the number of sensors used in mobile  The global security sensor market is
phones is expected to rise from 6 in 2009 expected to expand to grow at a CAGR of
to 17 in 2017, demand for sensors is 14% during 2014-17, on the back of rising
expected to grow at a CAGR of 8% during CCTV demand and growth of the network
2014-17 to reach US$22.4 billion in 2017. camera market.

Page 8
Market Potential

How industries project the revenue impact of IoT by 2018

Source: Internet of Things: The Complete Reimaginative Force, conducted by Research Now, Tata
Consultancy Services, 22 July 2015, as cited by eMarketer.

Page 9
Growth Drivers

Surge in  Sensors are being installed in the automotive industry to

increase safety and for automation use cases such as anti-lock
demand for IoT
braking systems, accident relief air bag systems and parking
sensors in the assist systems.
automotive
industry

Booming  Growing need for energy efficiency and compliance with

government regulations is driving need for automation in
Industrial
manufacturing sector. As sensors help in reducing energy
Internet of consumption and wastage, while also reducing maintenance
Things (IIoT) costs, manufacturers are increasingly installing sensors in their
market manufacturing units.

Government  Government regulations and policies across the globe are

encouraging the development of “smart cities”, thus offering a
push for smart
potential growth opportunity to the global IoT sensors market. In
cities smart cities, IoT sensors find use in smart meters, smart grids,
intelligent traffic management systems and smart parking
among others.

Technological  A lot of devices using IoT sensors such as biosensors,

nanosensors, and implantable sensors are being deployed in
advancements
the healthcare industry to focus on better patient care, lowering
in the medical costs and increasing efficiency.
industry  The use of sensors in blood pressure monitors, diagnostic
equipment and wearable devices will drive growth.

Increasing  Rising demand for smart appliances is boosting the market

demand for consumer electronics.
demand for
 The use of motion sensors is rising in applications for
mobile devices smartphones, tablets and gaming consoles. In addition,
and consumer proximity sensors, pressure sensors and temperature sensors
electronics based applications are emerging across consumer electronic
products such as smart TVs (and remote control), refrigerators,
ACs, washing machines and kitchen appliances.

Page 10
Demand of sensors in
IoT applications
Applications of IoT sensors across verticals

Building Healthcare & life Consumer & Transportation

automation science home automation

Light Pressure Gyroscope Gyroscope

Temperature Temperature Accelerometer Accelerometer

Chemical Chemical Magnetometer Magnetometer

Sensor
Accelerometer Bio-sensors Chemical Chemical

Contact
Sensor Light
Sensor Pressure
Sensor Pressure
Sensor

Inertial
Sensor Temperature
Sensor Temperature
Sensor

Industrial Environment Security & public Retail & logistics

safety

Pressure Chemical Gyroscope Light

Light Temperature Accelerometer Pressure

Chemical Light Magnetometer Temperature

Temperature
Sensor Pressure
Sensor Chemical Chemical
Sensor

Accelerometer
Sensor Humidity
Sensor Light
Sensor Magnetometer
Sensor

Example of IoT sensors in airliners

Legend:
Sensor There are over 5,000 sensors on a modern airliner: sensors for
fuel quantity and quality, flight attitude and angle of attack, flow
Level of demand sensors, ice detection, liquid level, pilot probes, air temperature.
The Airbus A350 has nearly 6,000 sensors and generates 2.5
terabytes of data per day. The Airbus A380-1000, scheduled for
deployment in 2020 with each aircraft carrying 1,000 passengers
will have 10,000 sensors in each wing.

Page 11
Gujarat - Competitive
Advantage
Ease of doing Established Flourishing
business/ Policy infrastructure economy
support

 Gujarat is ranked first in  Located on the west coast  Gujarat contributes

ease of doing business of India, Gujarat is well 7.2% of the Nation GDP
as per DIPP report 2015. connected to the major and shows leadership
cities of the world by air in many areas of
 Only state with 100% and sea routes. manufacturing and
compliance with infrastructure sectors.
environmental  The state has 45 ports, 12 Gujarat’s SDP (State
procedures. domestic airports and 1 Domestic Product) at
international airport in current price registered
 Gujarat ranked No.1 in e- addition to an extensive rail
transactions for a growth of 11% during
and road network. the year 2014-15.
government services
 Gujarat is the one of the  Gujarat has attracted
 Gujarat was ranked No. 1
power surplus states in the cumulative FDI worth
in terms of setting up a
country as a result it US$12 billion from April
business, allotment of
helping in bringing huge 2000 to March 2015.
land and obtaining a
amount of investment from
construction permit.  Gujarat contributes
the industries and tagged
 Encouraging Start up, around 19.1% to India’s
as preferred investment
IT&ITES & Electronics total exports of goods in
destination in the country.
policy of State. 2014-15

High availability of skilled manpower (engineers)

Engineering seats in Gujarat – by
specialisation (2016-17)  In 2016-17, Gujarat had ~134
Others 2,718 engineering degree colleges with an
intake of ~68,000 students per year.
Auto 2,202
Leading engineering colleges in Gujarat:
Chem 2,220  Indian Institute of Technology (IIT),
IT 4,857 Gandhinagar
Electronics 5,607  Sardar Vallabhbhai National Institute of
Technology, Surat
Electrical 9,611
 Gujarat Technological University,
Computer 10,224 Ahmedabad
Civil 12,114  Nirma University - Institute of Technology,
Mech 18,028 Ahmedabad
Total seats: 67581
Source: Gujarat Technical University
The state prides itself in quality workforce and peaceful workforce accounting for only
0.5% of mandays lost while having contributed 16% of India’s industrial production.
Page 12
Electronics and IT SEZ
in Gujarat
IT/ITeS and electronics regions
 Gujarat Government enacted the Special investment regions (SIR) act in 2009 with the objective
of creating large size investment regions in the state and develop them as global hubs of
economic activity supported by world class infrastructure.
 The state has three SIRs for electronics manufacturing.

 SEZ are special duty free enclaves for the purpose of trade. These zones are self-contained and
integrated, having their own infrastructure and support services. Apart from state-of-the-art
infrastructure and access to a large skilled work force, the SEZ also provides enterprises with
attractive incentives.
 The state has one electronics SEZ at Gandhinagar and 14 IT/ITeS SEZs - six at Ahmedabad,
four at Gandhinagar, three at Vadodara and one at Valsad.

Ahmedabad

Gandhinagar

Viramgam
Halol-Savli
Vadodara
Tourist Navlakhi
Electronics SIR flow*
IT/ITeS SEZ
Electronics and IT/ITeS SEZ Valsad

Promotion of IT/ITeS and electronics industries

 Gujarat Government introduced a new IT policy to provide a proactive and industry-friendly
climate for the IT industry. Incentives and assistance would be provided in allotment of land,
development of IT/ITeS parks, stamp duty concession, electricity duty exemption and capital
assistance on lease rentals.
 The policy also intends to establish the state as a preferred IT destination for micro, small and
medium enterprises (MSMEs) by providing assistance on quality certification, technology
acquisition fund, skill enhancement, patent assistance, simplification of labour laws, subsidy
on bandwidth for connectivity and exemption from zoning regulations.
 Gujarat Government introduced new Electronics policy with the aim of establishing a self-reliant
ESDM industry that caters to needs of domestic and international market. The policy includes
development of human resources, creation of local demand for electronics products, creation of
eco-system for innovation and R&D, and incentives such as VAT/CST subsidy, single window
clearance, uninterrupted power supply, registration and stamp duty concession and interest
subsidy.
 Gujarat Government, recognising the need for additional support for Electronics & IT/ITeS start-
ups and keeping this at the centre of its strategy as recognized by the Government of India,
through ‘Start-up India initiatives and to supplement efforts in that direction has decided to come
up with a focused policy for Start-ups in Electronics & IT/ITeS sector.
Page 13
Project Information

Electronic Manufacturing Clusters (EMCs) in Gujarat

Ahmedabad

Vithalapur

Gandhinagar
Sanand

Halol

Vadodara
Jambusar
Tourist
flow* Bharuch
Greenfield EMCs
Brownfield EMCs
Upcoming Greenfield

Location suggested
 Gandhinagar is a capital city of Gujarat
state and has seven special economic
zones and 10 industrial estates along
Key highlights with creative IT Park and Gujarat
International Finance Tech City (GIFT)
4 (Mansa, Kalol, Dahegam,
Talukas  It is considered as an emerging
Gandhinagar)
‘Knowledge Hub’ with the establishment
Gram of various educational institutes such as
302
panchayats IIT and IIMs.
 Various computer hardware
Area 2140 sq. km
associations such as Gandhinagar
Population 13,91,753 Computer Hardware Association
(GCHA) and Gujarat Informatics ltd
Literacy rate 85.77% (GIL) have their presence in
Gandhinagar.
Focus areas Electronics, textiles, IT -ITES  Gandhinagar has been selected as one
of the 100 Indian cities to be developed
as a smart city under PM Narendra
Modi’s flagship Smart Cities Mission.

Reasons for selecting Gandhinagar

Page 14
Project Information

Infrastructure availability
Logistics & connectivity

Rail Road

 Gandhinagar is well connected to the  Gandhinagar is connected to Surat,

metropolitans of western India. Many Mumbai, and Navi Mumbai through
trains with Mumbai as their destination National Highway 8A. It is connected to
pass through Gandhinagar, which Ahmedabad, Jaipur, Udaipur, New Delhi
facilitates an easy flow of tourists from and Chandigarh via National Highway
all over the western India. 8C.

Air Port

 Sardar Vallabhbhai Patel International  Gandhinagar is connected to the

Airport located in Ahmedabad is 18 km following ports:
away from Gandhinagar and provides  Dahej – 262 Km
connectivity with domestic flights to  Kandla – 306 Km
the Metropolitans and other major
 Mundra – 367 Km
cities of India. It also offers
international flight connectivity to
major countries across the world.

Utilities

Water Power

 Gujarat has a state-wide “water supply

grid” spread across 1,20,769 km that  The state is self-sufficient in power with its
aims to serve 75% of Gujarat’s present generating capacity of 23,973 MW
population. (including about 4,385 MW of renewable
 Gujarat Industrial Development energy).
Corporation (GIDC) is responsible for  Gujarat boasts of 24 hour – 3 - phase
ensuring consistent water supply in uninterrupted power supply
industrial areas

Page 15
Project Information

Semiconductor manufacturing process

 The process of manufacturing semiconductors, or integrated circuits (commonly called ICs, or
chips) typically consists of more than a hundred steps, during which hundreds of copies of an
integrated circuit are formed on a single wafer.
 The two basic stages in chip production are known as the “front end” and the “back end.” The
front end involves materials preparation (circuit design, photomask making and the manufacture
of raw wafers) and wafer processing/ fabrication (repeated cycles of deposition, etch, doping,
planarization, and in-process testing). The back end consists of assembly, packaging and final
test operations.

Wafer Wafer Assembly &

Dicing
production fabrication packaging

Stage Description
Wafer production  In this stage, silicon wafers are created from raw silicon.

 Separate wafer companies perform this process; few semiconductor

device makers produce their own wafers.
Wafer fabrication /  The fabrication process takes place in a clean room, wherein wafers are
front end run through a series of chemical and lithographical processes to etch the
processing transistor array and interconnects.
 This is the longest, most complex and most costly stage of semiconductor
manufacturing. Fabbed semiconductor producers and foundry suppliers
perform this process. Typically it takes from 10 to 30 days to complete the
fabrication process.
Dicing  The processed wafer is chopped into individual die using a diamond drill.
This is done at the beginning of the back end process.
Assembly and test /  Individual die are placed into a plastic or ceramic package and tiny wire
back end bonding is used to connect the input/output gates on the chip to the leads
processing on the outside of the package. The finished device is then tested.
 Assembly is done either by fabbed semiconductor producers or by third-
party outsourcers; test is usually done in-house by both fabbed and
fabless chip producers but can be outsourced.

Sensors are based on analog integrated circuits, which work by processing continuous signals.
Sensor technology is driven by key factors such as low cost, chip level integration, low power and
wireless connectivity. Many newer sensors are built using micro-fabrication techniques such as
MEMS (Micro-Electro-Mechanical Systems) technology. This provides huge advantages including
lower power consumption, small size and light weight.

Page 16
Project Information

Recent projects in India

Outlay
Facility Announced Type of
Company/consortium Capacity (INR
location date ICs
Crore)
Hindustan Semiconductor
Prantij, near 40,000 wafer
Manufacturing Corporation September
Gandhinagar, Digital ICs starts per month 25,250
with ST Microelectronics 2013
Gujarat on 300 mm
and Silterra
Greater 40,000 wafer
Jaiprakash Associates with September
Noida, Uttar Digital ICs starts per month 26,300
IBM and Tower Jazz* 2013
Pradesh on 300 mm
60,000 wafers per
Madhya February
Cricket Semiconductor Analog ICs month on 300 6,000
Pradesh 2015
mm

*In April 2016, JP Associates has withdrawn its proposal for the semiconductor plant.

 Gujarat is expected to have its first semiconductor wafer fabrication manufacturing facility by late
2017 in Prantij of Sabarkantha district, near Gandhinagar.
 The facility includes two manufacturing units each with capacity of producing 20,000 wafers per
month and will be set up by Hindustan Semiconductor Manufacturing Corporation (HSMC) along
with ST Microelectronics (France) and Silterra (Malaysia). The facility is expected to employ over
25,000 people including 4,000 direct employees.
 The outlay of the proposed fab is about INR25,250 crore for the fab facility of 40,000 wafer starts
per month of 300 mm size, using advanced CMOS technology. Technology nodes proposed are
90, 65 and 45 nm nodes in Phase I, and 45, 28 and 22 nm nodes in Phase II.
 The incentives from GoI are available under the Modified Special Incentive Package Scheme
(M-SIPS) and deduction available for expenditure on R&D under the Income Tax Act.
 In addition, fab facilities will also be eligible for investment linked deduction under Section 35AD
of the Income Tax Act. The government will provide Viability Gap Funding (VGF) in the form of
an interest free loan for a period of 10 years.

Example of a recent grant for developing sensors

The Centre for Materials for Electronics Technology (C-MET) has been granted INR200 crore in
the Union Budget to indigenously develop advanced sensors, such as iris sensors and movement-
based sensors, for use in smart cities. The institute has its headquarters in Pune and has centres
in Thrissur and Hyderabad.

Page 17
Project Information

Leading manufacturers of IoT sensors worldwide

Industrial sensors Automotive sensors
Bosch Sensortec, Siemens, Bosch Sensortec, Continental
STMicroelectronics, Texas Delphi Automotive, DENSO,
Instruments Sensata Technologies
Mobile and security sensors Other leading players
STMicroelectronics, Sony Honeywell International
Semiconductor, SK Hynix, Infineon Technologies, IBM,
Samsung Techwin Ericsson, InvenSense

Key manufacturers of sensors in India

Player name Description of plants in India

Robert Bosch Plans to open a plant for IoT specific products in India, focusing primarily on
development of sensors and actuators
Honeywell Sensor assemblies such as LCD hour meter, Wheel speed sensor, Throttle
International Positioning Sensor
Continental Manufactures Chassis sensors among other automotive components; also
Automotive supplies sensors to its customers in India from its global plants
Components (India)
Baumer Technologies Supplier of sensor products for applications in factory and process
automation
TURCK India Manufactures inductive proximity and capacitive proximity sensors for
Automation industrial automation
Hella India Has a design center in Pune, engineering center in Chennai and
Automotive manufacturing unit in Dhankot (Gurgaon); manufactures temperature
sensors among other automotive components

Raw material used Suppliers

 Silicon wafers, Photomasks,  BASF, Dow Chemical, Air Liquide, Linde,
Photoresists, Wet chemicals, CMP Air Products and Chemicals, Praxair, Kanto
slurry and pads, Gases, Sputter Chemical, Taiyo Nippon Sanso
targets, Photoresist ancillaries  Arro Asia, Digi Key, Mouser, Newark,
Farnell, R S India Components

Page 18
Project Information

Key machinery suppliers

 Applied Materials, ASML, Tokyo Electron, Lam Research, KLA-Tencor, Teradyne, Advantest,
Hitachi Kokusai Electric, ASM Pacific Technology, Hitachi High-Technologies

Potential collaboration opportunities

 Sensor manufacturing unit can be used to produce other analog ICs for economies of scale
such as power semiconductors used in IoT devices, so there can be collaboration with other
companies/consortia looking to manufacture similar type of ICs.
 There could be partnerships with vertical-focused companies who do not prefer backward
integration such as automotive players embedding sensors in infotainment.

India Electronics and Semiconductor National Centre for Flexible Electronics

Association (IESA) (NCFlexE):

National Centre of Excellence in Technology for

Internal Security (NCETIS)

Page 19
Project Financials

Estimated project cost

Project components & specifications Cost (INR crore)
Equipment and machinery 1,800.0

Land 136.0
Site area: 75 acres (303,515 sq. mtr.)
Rate: INR4,480 per sq. mtr. as of June 2016
Building 197.2
Floor area: 45 acres (182, 109 sq. mtr.)
Rate: INR10,826.184 per sq. mtr.
Contingency costs 71.9
(includes utility costs, repair and maintenance, transport charges,
advertisement and publicity, insurance and miscellaneous expenses)
Total initial investment 2,205.0

 The construction of 12-inch fab with capacity to produce 30,000 wafer starts per month on 300
mm manufacturing technology will require initial investment of around INR2,200 crores.5
 The setup will require manpower of around 4,000 people with 80% of them as assembly line
workers.

Page 20
Approvals / Incentives

Approvals required

• For approvals, the project report should be submitted to respective District Industries Centres
(DICs). DIC will forward the proposal to Industries Commissioner who will submit the report to
State Level Approver Committee (SLAC) for final approval.

Incentives from Government of Gujarat

Government of Gujarat introduced Electronic Policy for the state of Gujrat (2016-2021) in order to
establish Gujarat as a globally-recognized hub for the ESDM industry with a turnover of US$16
billion by 2021 and an investment of US$6 billion to create employment opportunities for 500,000
people by 2021.

In addition to the assistance available under any of the schemes of the Government of India,
eligible EMC and ESDM units will be entitled to the following assistance from Government of
Gujarat:

Incentives to the Electronics Manufacturing Clusters (EMCs)

Capital assistance to the greenfield EMCs
Eligible area for greenfield EMCs Admissible Maximum limit
assistance (INR crores)
Area less than 200 acres 25% 25
Area more than 200 acres 25% 100

Stamp duty and registration fee reimbursement

• Developers of greenfield EMCs will be entitled to 100% reimbursement of the stamp duty as
well as registration fee paid by them to the Government of Gujarat, towards lease/sale/transfer
of land for the EMC.

Uninterrupted availability of power and power tariff subsidy to EMCs

• Government will contribute towards the cost of setting up feeder or sub-station (subject to a
ceiling of INR5 crores) in order to provide uninterrupted and good quality power supply to the
EMCs.
• Power tariff subsidy will be given at INR1 per unit in the billed amount for a period of five years
as promotional incentive on reimbursement basis. The subsidy will be applicable only when
electricity will be purchased from the state electricity / power distribution licensee.
• EMCs will be given 100% reimbursement for electricity duty paid for a period of 5 years from the
date of approval of EMC.

Page 21
Approvals / Incentives

Incentives to the ESDM units

Capital subsidy to the eligible ESDM units
Gross fixed capital investment (GFCI) Admissible Maximum
subsidy limit
(INR crores)
Investment up to INR10 crore 10% 1
Investment above INR10 crore but up to INR1 crore + 5% incremental 25
INR1000 crore GFCI above INR.10 crores
Investment above INR1000 crore INR25 crore + 5% incremental 100
GFCI above INR1000 crores

Interest subsidy for a maximum period of five years to the eligible ESDM units
Borrowings Admissible Maximum
subsidy per annum limit per
annum
(INR crores)
Up to INR10 crore 7% 1
Above INR10 crore but up to INR1000 crore INR1 crore + 2% of borrowings 5
in excess of INR10 crores
Above INR1000 crore INR5 crore + 1% of borrowings 10
in excess of INR1000 crores

Reimbursement of stamp duty and registration fee

• Eligible ESDM units will be entitled for reimbursement of 100% of stamp duty and registration
fee paid to the Government of Gujarat for lease/sale/transfer of land for the first transaction.

VAT/CST incentives: (subject to change after the introduction of GST)

• The eligible ESDM units will be provided reimbursement of net tax paid under Section-13 of
Gujarat Value Added Tax Act and 100% of Central Sales Tax (CST) for domestic sales outside
Gujarat, limited to a ceiling of 90% of the GFCI made by the unit, for a period of 10 years.

Other exemptions
• Eligible ESDM units will be given power tariff subsidy at the rate of INR1 per unit in the billed
amount and 100% reimbursement for electricity duty, for a period of five years.
• Eligible units will be given the benefit of reimbursement of the EPF contribution made by them
for their employees for a period of five years subject to overall ceiling of INR1 crore per annum.
• Patent Assistance at the rate of 50%, subject to a ceiling of INR0.2m per patent for domestic
patents and INR0.5m per patent for international patents, for meeting the expenditure for
obtaining patents.

Page 22
Approvals / Incentives

Incentives from Government of India

Modified Special Incentive Package Scheme (MSIPS)

• The scheme provides capital subsidy of 20% in SEZ (25% in non-SEZ) for units engaged in
electronics manufacturing. It also provides for reimbursements of non-creditable excise for
capital equipment for the non-SEZ units.
• Reimbursement of central taxes and duties for 10 years in select high-tech units such as fabs,
semiconductor logic and memory chips, LCD fabrication.

Electronic Manufacturing Clusters (EMC)

• The GoI will provide financial assistance of up to 50% of the project cost (subject to a ceiling of
INR500 million for every 100 acres of land) for the development of greenfield EMCs, and 75% of
the project cost (subject to a ceiling of INR500 million) for brownfield EMCs.

Electronics Development Fund (EDF)

• In December 2015, the GoI announced setting up a special EDF worth INR100 billion to help
generate an R&D ecosystem in electronics in India. The fund aims to boost IP generation and
large-scale manufacturing of electronic goods in the country.

Additional incentives for semiconductor manufacturing

• In the Union Budget 2016-17, BCD and SAD have also been exempted on machinery, electrical
equipment, other instruments and their parts (except populated Printed Circuit Boards) for use
in semiconductor wafer fabrication/LCD fabrication and Assembly, Test, Marking and Packaging
of semiconductor chips (ATMP) units.
• According to Semiconductor Policy, the incentives will be for the manufacturer of all
semiconductors, displays including Liquid Crystal Displays (LCDs), Organic Light Emitting
Diodes (OLEDs), Plasma Display Panels (PDPs) and any other emerging displays, storage
devices, solar cells, photo voltaics, other advanced micro and nanotechnology products, and
assembly and test.
Type of unit Threshold NPV of Incentive in SEZ Incentive in Non-
investments SEZ

Fab unit INR2,500 crore 20% 25% + exemption

from CVD
Eco-system unit INR1,000 crore 20% 25% + exemption
from CVD
Note: (Incentive in % of capital expenditure); CVD is Countervailing Duty

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Approvals / Incentives

Objective of the Department of Electronics and Information

Technology (DeiTY), Draft IoT policy
 To create an IoT industry in India of USD 15 billion by 2020. It has been assumed that India would have a share of
5-6% of global IoT industry.
 To undertake capacity development (Human & Technology) for IoT specific skill-sets for domestic and international
markets.
 To undertake R&D for all the assisting technologies.
 To develop IoT products specific to Indian needs in all possible domains of agriculture, health, water quality, natural
disasters, transportation, security, automobile, supply chain management, smart cities, Automated metering and
monitoring of utilities, waste management, Oil & Gas) etc.

Pillars of IoT policy

IoT policy

Standards

Incentives R&D and Capacity Human

Demonstration resource
and innovation building center development
engagement

Governance structure

The Policy framework of the IoT Policy has been proposed to be implemented via a multi-pillar approach. The
approach comprises of five vertical pillars (Demonstration Centres, Capacity Building & Incubation, R&D and
Innovation, Incentives and Engagements, Human Resource Development) and 2 horizontal supports
(Standards & Governance structure).

Source: Department Of Electronics & Information Technology, Government Of India

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 Ministry Of Electronics And Information Technology
http://meity.gov.in/
India Electronics & Semiconductor Association

http://www.iesaonline.org/
Department of Science & Technology, Government of Gujarat
http://www.dst.gujarat.gov.in
Gujarat Industrial Development Corporation
www.gidc.gov.in

Office of Industries Commissioner

www.ic.gujarat.gov.in

Industrial Extension Bureau

www.indextb.com

This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope.
It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.

Department of Science and Technology

Block No.7, 5th Floor,
New Sachivalaya, Gandhinagar
Phone / Fax : 079-23259999
Email: secdst@gujarat.gov.in
https://dst.gujarat.gov.in/index.htm