Andhra Pradesh Electronics Manufacturing Policy (4.0): Incentives & Benefits

With India’s vision to become a global manufacturing leader, states are stepping up with targeted industrial policies. Among them, the Andhra Pradesh Electronics Manufacturing Policy (4.0), valid from 2024 to 2029, stands out as a powerful roadmap for investors in the electronics sector.

It aims to develop an inclusive ecosystem that supports innovation, encourages investments, and provides long-term incentives. Whether you’re a startup or an established electronics company, this policy offers strategic advantages to build or scale operations in Andhra Pradesh.

Applicability of the Policy

The Andhra Pradesh Electronics Manufacturing Policy applies to the following:

• New enterprises setting up fresh units in the state
• Existing enterprises expanding their current capacity within Andhra Pradesh

This structure ensures that businesses of all scales—from SMEs to large corporations—can benefit from this policy. The clarity of scope and structure helps businesses plan their investments with confidence.

Incentives and Concessions Under the Policy

The policy offers a wide range of financial incentives that are tied to the scale of investment and the level of value addition. These are divided into three main investment bands:

Sub-Large Projects

Investment Size: ₹50 Crores to ₹200 Crores
Implementation Period: 3 years

Key Benefits:

• Capital Subsidy: 20% of Eligible Fixed Capital Investment (EFCI), disbursed in 5 equal annual installments
• Top-up on Value Addition: An Additional 5% of the Capital Subsidy upon achieving value addition
• Power Cost Reimbursement: ₹1 per unit for 5 years from the date of commencement of commercial production
• 100% Net SGST Reimbursement: Applicable on the sale of final products manufactured, sold, and registered in Andhra Pradesh, for 5 years
• Stamp Duty Reimbursement:
  • 100% reimbursement on the purchase of land meant for industrial use
  • 100% reimbursement on lease of land/shed/buildings, mortgages, and hypothecations
  • Reimbursement is applicable only once on the same land

This band is especially favorable for mid-scale manufacturers looking to benefit from high ROI via capital and operational subsidies.

Large Projects

Investment Size: ₹200 Crores to ₹1,000 Crores
Implementation Period: 3 years

Key Benefits:

• Capital Subsidy: 25% of EFCI, disbursed in 7 equal annual instalments
• Top-up on Value Addition: Additional 5% of Capital Subsidy on achieving predefined value-addition targets
• Power Cost Reimbursement: ₹1 per unit for 5 years post commercial production
• 100% SGST Reimbursement: For a 5-year duration from the production start date
• Stamp Duty Reimbursement:
  • 100% reimbursement on purchase and lease of industrial land/buildings
  • One-time reimbursement only for the original land transaction

This category is built to encourage large domestic and foreign players to establish manufacturing facilities with reduced upfront and operational costs.

Mega Projects

Investment Size: ₹1,000 Crores to ₹5,000 Crores
Implementation Period: 4 years

Key Benefits:

• Capital Subsidy: 30% of EFCI, disbursed in 10 equal annual installments
• Top-up on Value Addition: Additional 5% subsidy upon meeting specified value-addition benchmarks
• Power Cost Reimbursement: ₹1 per unit for 5 years post-production
• 100% SGST Reimbursement: For sales of final products registered within Andhra Pradesh
• Stamp Duty Reimbursement:
  • Full reimbursement for purchase and leasing of land, buildings, mortgages, etc.
  • Stamp duty is only reimbursed once per land asset

For mega projects involving substantial capital, this policy becomes a strategic enabler by reducing total project cost while supporting long-term scalability.

Policy Highlights at a Glance

Final Thoughts

The AP Electronics Policy 4.0 PDF outlines a transformative strategy that aims to create a holistic and competitive electronics ecosystem in India. By integrating financial benefits with regulatory support, the policy encourages investors to view Andhra Pradesh as a long-term partner.

For companies in semiconductors, IoT, PCB, mobile manufacturing, or consumer electronics, this policy delivers both capital and operational cost advantages. It enables manufacturers to position themselves better in the global value chain while taking advantage of India’s favorable geopolitical positioning.

Ready to Benefit from This Policy?

If you’re an investor or manufacturer looking to unlock the Electronics Manufacturing Subsidy for Andhra Pradesh or want clarity on eligibility, application processes, or land options, expert guidance is just a click away.

Get in touch today for a custom consultation tailored to your project size and business goals.