Scheme for Promotion of manufacturing of Electronic Components and Semiconductors (SPECS)

Notification No. W-18/30/2019-IPHW-MeitY.—

The Government attaches high priority to electronics hardware manufacturing as it is one of the important pillars of both “Make in India” and “Digital India” programmes of Government of India. Domestic electronics manufacturing has increased substantially over the last few years and is steadily moving from Semi Knocked Down (SKD) to Completely Knocked Down (CKD) level of manufacturing. But there is much to achieve in terms of manufactring:

Firstly, Development of supply chain is essential for the manufacturing of electronic products with higher domestic value addition.

Secondly, The manufacturing of electronic components and semiconductors is capital intensive and must be dealt with constantly changing technology.

Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS)

1. It is proposed to offer financial incentive of 25% of capital expenditure for the manufacturing of goods as per Annexure that constitute the supply chain of an electronic product under the Scheme for Promotion of manufacturing of Electronic Components and Semiconductors (SPECS).The incentive will be provided on reimbursement basis.

2. The capital expenditure will be total of expenditure in plant, machinery, equipment, associated utilities and technology, including for Research & Development (R&D). Details of such eligible capital expenditure will be included in the guidelines. The total value of refurbished plant, machinery and equipment (including for associated utilities and R&D), whether imported or domestically procured, not exceeding 20% of the total eligible plant, machinery and equipment (including for associated utilities and R&D), shall be considered for calculation of incentive in this regard.

3. The incentives, if any, offered by the State Government or any of its agencies or local bodies shall be over and above the incentive eligible under the proposed scheme.

4. The applicants shall also be eligible to take benefit under any other scheme(s) of Government of India. However, investments committed by the applicants under M-SIPS scheme for which incentives have been claimed will not qualify as eligible investments under SPECS scheme.


The SPECS will be applicable to investments in new units as well as expansion of capacity/ modernization and diversification of existing units.

Threshold Limit

1. The minimum threshold investment to be eligible under the scheme is given in Annexure.
2. The thresholds are same for new units or expansion of capacity/ modernization and diversification of existing units.

Tenure of the Scheme

The SPECS will be open for applications initially for 3 years from the date of its notification.

Approval and Disbursement Process

1. Application under the scheme can be made by any entity registered in India.

2. Each and every application will be treated as new investment and will be treated as an independent application. The application shall be only for single phase projects and phase-wise applications will not be considered under the Scheme. There is no restriction on any applicant from making multiple applications and/ or for multiple locations.

3. An initial application completed in all respects and submitted before the due date of the scheme will be appraised on an ongoing basis and considered for approval.

4. Incentive under the scheme will be applicable from the date of acknowledgment of the application. Acknowledgment will be issued after initial scrutiny of the application. The acknowledgement of the application shall not be construed as approval under SPECS.

5. The incentive will be available for investment made within 5 years from the date of acknowledgement of the application.

6. The incentive against the eligible capital expenditure shall be released after the approval of the application, subject to capital expenditure exceeding the threshold value and commencement of commercial production. The subsequent claims for the incentive may be submitted on a six-monthly basis.

7. The unit receiving incentive under SPECS will have to remain in commercial production for a period of at least 3 (three) years from the date of commencement of production or 1(one) year from the date of receipt of last incentive, whichever is later.


More Information will be available from the Scheme Guidelines as framed by Ministry of Electronics & Information Technology on timely basis.


Government has also introduced Production based Subsidy Scheme in order to promote Electronics manufacturing, which can be read at: Electronics- Production Subsidy


To read about reduced rate of tax for newly established domestic manufactring companies: Visit Section 115BAB


Capital Subsidy on Electronics

For any query, Don’t feel hesitant to write us at

Also, you can share your query by filing the below mentioned form.

We will be happy to respond.