The Central Government is looking at creating an ecosystem for a globally competitive ESDM (Electronic System and Design and Manufacturing) sector in the country through its newly approved the National Policy on Electronics 2012. It will promote the manufacturing of indigenously designed and manufactured chips creating a more cyber secure ecosystem in the country.

The policy aims to take the domestic electronic hardware manufacturing segment into a $400 billion (`20,40,000 crore) industry by 2020. Under the policy, the government will be setting up a National Electronics Mission with industry participation and renaming the Department of Information Technology as Department of Electronics and Information Technology (DEITY). It will build on the emerging chip design and embedded software industry to achieve global leadership in Very Large Scale Integration (VLSI), chip design and other frontier technical areas and to achieve a turnover of $55 billion (approx `2,80,500 crore) by 2020. The government will build a strong supply chain of raw materials, parts and electronic components to raise the indigenous availability of these inputs from the present 20- 25 per cent to over 60 per cent by 2020. The policy will enable creation of long-term partnerships between ESDM and strategic and core infrastructure sectors - Defence, Atomic Energy, Space, Railways, Power, Telecommunications, etc.

Further, the government cleared Preferential Market Access policy for domestic telecom products manufactures. "Making India a manufacturing equipment hub will promote development of technology and self-reliance and create ground for India to take leadership position in both telecom equipment and handset market. But the prerequisite for this is support to R&D in all forms. This will also help address some of the security concerns," said Hemant Joshi, Partner, Deloitte Haskins & Sells. As per the notification, all government departments and agencies under its control will have to buy between 50 per cent and 100 per cent of the total requirement from local manufacturers depending on the type of equipment. Private operators have not been included in this notification. The policy will address the security concerns from the imported products and the huge import bills. Security agencies have repeatedly raised concerns about possible spyware and malware embedded into imported products, especially those coming from China. This apart, the government has set targets for value addition for each of the products 'Made in India'.

As per the notified policy, "All the telecom products, which do not meet the minimum value addition criterion for that year, shall be treated as imported telecom products and dealt accordingly". With this, technology companies will not only have to set up a factory in India, but also add value here instead of just assembling products. This would need an ecosystem of component suppliers to also set up units in India

In the Automobile sector, the government approved the setting up of a National Automotive Board (NAB) under the Department of Heavy Industry (DHI). The board will comprise domain experts who will promote research and development activities and play a big role in developing skills for the automobile sector. The board was envisaged as a national authority, to oversee the functioning of the National Automotive Testing and Research and Development Infrastructure Project (NATRIP) centres. The board will have its headquarters in the National Capital Region. NATRIP was formed to set up new auto testing and research and development centres and to upgrade existing ones.

Also, a Group of Ministers (GoM) cleared much awaited land bill for Cabinet consideration after resolving disputes between ministries. The Bill will replace the 117-year-old Land Acquisition bill of 1894. As per the final draft, approval of two-third of land owners and affected families will be required for acquiring land for PPP and private sector projects with defined public purposes. The Bill - now called the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill 2011 - in its earlier version had proposed that acquisition could proceed only if 80 per cent of the affected parties agreed to part with their land. Ongoing land acquisitions where award has not been made or possession hasn't been taken will not be impacted by the proposed law. Also, the provisions of the law won't be applicable for SEZs, which are governed by a separate Act. Further, it seeks to prohibit land acquisition in Panchayat Extension to Schedule Area (PESA) and forest areas. If the Bill is approved by the Parliament and vetted earlier by the relevant House panel, in the Winter session - it will remove yet another hurdle for investors and encourage economic activity.

In the Energy sector, the Ministry of Power has done away with the mandatory PPA condition for ensuring coal linkages. "FSAs will still be signed even if there is no PPA in place. But actual coal supply would not begin until PPAs are not signed by a power company ," P Uma Shankar, Power Secretary said, explaining how the FSA issue has been resolved with CIL. A presidential directive to CIL earlier this year had put PPAs as a condition for supply assurance to companies by CIL. According to the ministry, Power companies have PPAs in place for 28,000 MW. These plants are yet to sign FSAs with CIL. Projects with around 2,000 MW of capacity are yet to sign PPAs with distribution companies. Overall, FSAs are to be signed with power projects of 60,000 MW capacity.

On the state level, the Tamil Nadu Government announced the Tamil Nadu Solar Energy Policy 2012 with the plans to generate 1,000 MW of solar power every year from 2015, setting up of solar energy parks along with incentives for solar power producers and equipment manufacturers. The state government has also made rooftop solar panels mandatory for new buildings from the government and local bodies. Under the policy, the government will support domestic consumers who install solar panels on their buildings rooftop. Big industries and customers of high tension electricity should utilise a certain per cent of their power consumption from solar energy. For solar power producers, the state government will offer facilities like net metering which would help them in connecting to the grid, exemption from power charges and power cut. The existing government buildings and local body buildings will have roof top solar panels installed in various steps. The street lights and drinking water distribution mechanisms will also be shifted to solar power managed in gradual steps.