A company setting up an electronics manufacturing unit in Andhra Pradesh can now get back as much as 50 percent of the capital investment it has made on the unit after its commercial operations.
Making the fiscal incentives an ever bigger lure to attract companies in this sector, Andhra Pradesh government has recently enhanced the subsidy on capital investment to 30 percent with a cap of Rs 250 crore. Earlier the capital subsidy in AP was 10 percent, that too limited to a maximum of Rs 5 crore.
This comes on top of 20 percent capital subsidy being offered by Government of India, which had recently extended the eligibility to 15 new electronic products, including consumer electronics and Internet of Things(IoT) products.
As the subsidy offered by the two governments on this front alone will add upto 50 percent of the capital investment made by a company, the state government believes more investments would flow into the state in electronics industry.
After Taiwanese electronics manufacturing company Foxconn had established its mobile assembly plant in Sricity, the government has made sustained efforts to bring more mobile and electronics manufacturing companies into this region by offering land and other incentives. The increase in capital subsidy will further boost these efforts, according to AP government officials.