New Delhi, Feb 25 (IANS): The IT hardware sector has the potential to generate four lakhs jobs in five years if the government provides requisite tax impetus to the manufacturing of notebook and desktop personal computers in the upcoming Budget, industry body Manufacturers Association for Information Technology (MAIT) said here in a study on Wednesday.

"Within the manufacturing sector, the growth of the IT electronics sector is critical for realizing the visionary initiatives of 'Make in India' and 'Digital India' launched by the government, and help India garner a 10 percent share of the worldwide ESDM (Electronic System Design & Manufacturing) sector by 2020," the MAIT study said.

"What's more, there is potential to generate 100,000 direct jobs and 300,000 jobs in components manufacturing over the next five years," it added.

"India has a large and growing market for IT products and ESDM hardware. Due to various disabilities impacting domestic manufacturers, a large part of this market is being served by imported products, mostly from China.

"In 2015, we believe the share of domestic manufacturers was only 45 percent of the total ESDM market of 31.6 billion dollars. For the IT products market of 5.8 billion dollars this proportion was even lower at around 32 percent," said Anwar Shirpurwala, executive director, MAIT.

Domestic manufacturers are at a competitive disadvantage when it comes to imports on account of both tax provisions as well as market factors, the association said.

"To address this concern and to encourage domestic manufacturing of IT products, the industry is requesting that the differential excise duty regime introduced by the government in 2015 for mobile phones and tablets be extended to notebook PCs and desktop PCs," MAIT said.