'Make-in-India’ vision looks good but not feels good to PC makers

Modi’s government vision of ‘Make-in-India’ and his furious promotions of Vibrant Gujarat and other states in the row, the PC makers of the country are still not satisfied with the government. The reasons why PC makers such as Dell, Acer, etc. are avoiding manufacturing in India and preferring to import the components:

a.      High rate of Tax: The rate of duty on manufacture is 16% along with the VAT varying from 4 to 12 percent depending upon the state as compared to mere 17.42% duty levied on imports.

b.      High Rate of Interest: Rate of interest on finance if obtained from within the country is around 15% whereas the same in global financial markets is not more than 2 to 4 percent.

c.      Costlier Power: Electricity is much costlier in the country as compared to other countries. Irregular supply of electricity causes further troubles to the manufacturers.

All these factors along with some other hurdles has made manufacturing less preferable. The maximum units established in the country are used most of the times only for assembly of the PCs and the capacity is underutilized. India imported an estimated $38 billion worth of electronics last year while only about $19 billion worth of goods were manufactured here.