India needs to build strong manufacturing base; M&A rules soon: PM

New Delhi: Prime Minister Manmohan Singh today said a strong domestic manufacturing base in electronics and telecommunications will mitigate burden of growing imports for the sector.

“India needs to develop a strong domestic manufacturing base in electronics and telecommunications,” Singh said in his inaugural address at the industry event ‘India Telecom 2013’.

He said by 2020, it is estimated India will be importing electronics products worth about 300 billion dollars, which will be more than the value of the country’s imports of petroleum products.

[caption id=“attachment_1263749” align=“alignright” width=“380”]  Prime Minister Manmohan Singh. PTI[/caption]

“We need to act now to avoid a situation where we face difficulties in financing these huge imports. India should have manufacturing facilities which result in a balanced trade in electronics products and are a part of global supply chains,” Singh said.

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Talking about policies in the telecom sector, Singh said National Telecom Policy 2012 has brought clarity on number of issues in the sector.

“I understand that the Department of Telecommunications has already started issuing Unified Licenses and will also shortly issue the Merger and Acquisition guidelines,” he said.

The Empowered Group of Ministers early this week firmed up their views on M&A rules and the same has to be placed before cabinet for approval. Elaborating on use of telecom technologies for modernising systems, Singh touched upon Telecom Ministry’s plan to provide 3G connectivity with computers for students.

“Combining a computer with 3G connectivity can revolutionise the delivery of education. Students can learn the subject of their choice from quality teachers without leaving the place of their residence. I am told that the Telecom Commission is working on such possibilities and I wish them all success in this noble endeavour,” he said.

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The Ministry is learnt to be in process of developing a project under which a tablet PC will be given to students with 3G connection. But the proposal is yet to receive nod of inter-ministerial panel Telecom Commission after which it may have to seek approval of Cabinet for final implementation.

Speaking on the occasion, Telecom Minister Kapil Sibal said the government is looking at addressing the immediate concerns of the industry by firming up new rules.

He expressed confidence in garnering Rs 40,000 crore from auction of spectrum during this fiscal.

“Considering industry friendly regulatory changes that we promulgated, I am confident of meeting revenue target of Rs 40,000 crore from spectrum sale this fiscal,” Sibal said.

The spectrum auction are expected to commence in third week of January.

The EGoM on telecom, headed by Finance Minister P Chidambaram on Tuesday approved auction of 403.2 megahertz of airwaves frequency in addition to premium 2G airwaves in three metros. Even at base price, the total airwaves being put for auction amounts to about Rs 48,000 crore.

Minister of State for Communications and IT, Milind Deora, cited differences within industry as one of the reasons adversely impacting the sector. “Before government and industry unite, industry must unite. That is something that government can only facilitate not mandate,” Deora said.

He said the government has brought in clarity in the entire Information Communication Technology and Electronics (ICTE) sector through new policies and strived for level playing field for all players.

“We have left no stone unturned in trying to create attractive and level playing field for entire ICTE ecosytem of operators…electronic system design and manufacturing sector and certainly we could do even better if operators were represented by one industry association,” he said.

In telecom sector, mobile operators have two industry associations - COAI which represents GSM technology based service providers like Airtel, Vodafone, Idea Cellular and AUSPI which represents telecom players who started operations based on CDMA technology like Reliance Communications, Tata

Teleservices and Sistema Shyam.

There have often been sharp differences between the two associations on policy matters.

Deora said that dealing with a single industry association makes policy formation easy for government.

PTI