Modified Special Incentive Package Scheme (M-SIPS)

Modified Special Incentive Package Scheme (M-SIPS) is an incentive scheme launched by the Government of India in 2012 to attract investments and boost production in the electronics goods industry. India’s demand for electronic goods made it third-largest import item of the country. Currently, the total electronic goods imports account for 65%. The Ministry of Communication and Information Technology together with the Government has planned to increase electronic manufacturing to meet the demands of local as well as the global market and reduce importing thus reaching a target of zero imports by 2020. The purpose of initiating Modified Special Incentive Package Scheme (M-SIPS) was not only to encourage investments but also to generate employment opportunities.

M-SIPS Scheme

The incentive under the M-SPIC scheme is in the form of subsidy and is available for a startup project, the expansion of the project (in terms of capital invested) or the diversification of project (variation in the range of products). The Government offers a subsidy of 20% on investments in special economic zones (SEZs) and 25 per cent on capital investments in non-SEZs. The incentives are provided reimbursement basis (i.e.) subsidy claimed after investments have been made and are available for ten years from the date of approval (date of submission of application not receipt of application). Reimbursement of central taxes and duties is obtainable for projects with high capital investment. This scheme also provides incentives to relocate units from abroad to India.

Eligibility Criteria

The applicant is eligible to avail this scheme if the investment ranges between one crore and 5000 crores based on the type of project. The investment threshold for each product category is prescribed by the Government, which the applicant should satisfy.

Applying for Modified Special Incentive Package Scheme (M-SIPS)

The Department of Electronics and Information Technology will receive all initial applications under MSIP scheme on or before 26-07-2020. The application form has to be submitted online by the registered applicant along with a non-refundable application fee.

Project Cost	Initial application fee (INR)
Less than 10 crores	10,000
10 to 100 crores	25,000
100 to 1000 crores	50,000
More than 1000 crores	1,00,000

The applicant has to furnish the necessary details in the application form which includes,

Applicant details
Electronic Manufacturing Cluster Details
Project Proposal
Financial Closure Details
Initial Application Fee Details (fee should be paid in demand draft)

Eligible applications will be approved in 120 days from the submission of complete application. The online application can be submitted by visiting the

official website of e-MSIPS, a web-based system which supports the process.

e-MSIPS login

Amendments to MSIPS

Amendments to the scheme were implemented on August 3, 2015. The prominent amendments include

Initially, the scheme was implemented for 3 years until 26-07-2015, which has been later extended up to 27-07-2020.
Originally the scheme covered 29 electronic verticals which were later expanded to support additional verticals.
The process has been simplified for the grant of approval. The incentives for the project is made available for 10 years which were 5 years earlier.

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Frequently Asked Questions

Common questions about Modified Special Incentive Package Scheme India.

The Modified Special Incentive Package Scheme (M-SIPS) is an incentive scheme launched by the Government of India in 2012 to attract investments and boost production in the electronics goods industry. It offers subsidies on capital investments to encourage domestic manufacturing of electronics products.

The M-SIPS scheme offers a subsidy of 20% on investments in special economic zones (SEZs) and 25% on capital investments in non-SEZs. It also provides reimbursement of central taxes and duties for projects with high capital investment and incentives to relocate units from abroad to India.

To be eligible for the M-SIPS scheme, the applicant's investment should range between one crore and 5000 crores based on the type of project. The investment threshold for each product category is prescribed by the Government, which the applicant should satisfy.

Applicants can apply for the M-SIPS scheme by submitting an online application form along with a non-refundable application fee on the official e-MSIPS website. The application fee varies based on the project cost.

The application fee for the M-SIPS scheme ranges from INR 10,000 for projects with less than 10 crores investment to INR 1,00,000 for projects with more than 1000 crores investment.

Eligible applications for the M-SIPS scheme will be approved within 120 days from the submission of a complete application.

The major amendments made to the M-SIPS scheme in 2015 include extending the scheme's validity until 27-07-2020, expanding the coverage to additional electronics verticals, simplifying the approval process, and increasing the incentive period from 5 to 10 years.

The primary goal of the M-SIPS scheme is to encourage investments in the electronics manufacturing sector in India, generate employment opportunities, and reduce the country's reliance on imports of electronic goods.

The M-SIPS scheme is applicable to new startup projects, expansion of existing projects (in terms of capital invested), and diversification of existing projects (variation in the range of products).

The Ministry of Communication and Information Technology, along with the Government of India, has planned to increase electronic manufacturing through the M-SIPS scheme to meet the demands of local and global markets and reduce imports, targeting zero imports by 2020.