ELCINA was the first Indian Electronics industry association and an interactive forum for electronics and IT manufacturers. ELCINA believes that the Government and the industry need to work together to stimulate manufacturing and catalyse an IT/Electronics boom that can contribute significantly to the development of India.
ELCINA persistently works to facilitate changes that would strengthen India’s electronics and IT manufacturing base to make it a leader on the world electronics map.
Mr. Umesh Anandani, Additional Secretary, ELCINA ELECTRONIC INDUSTRIES ASSOCIATION OF INDIA” spoke to Electronics Maker about ELCINA outlook on Indian Industry. Excerpts from Interview:
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Please put light on electronics consumption in India, percentage growth rate and key drivers?
India has been the center of consumer demand fuelled by a phenomenal GDP growth. While demand increased across all sectors, demand for high technology products, specifically electronic products has registered significant growth and going by current estimates, the demand for electronics hardware in the country is projected to increase from USD 45 billion in 2009 to USD 400 billion by 2020 (Source: Task Force Report). The estimated production will reach USD 104 billion by the year 2020, creating a gap of USD 296 billion in demand and production. This creates a unique opportunity for companies in the ESDM (Electronic System Design & Manufacturing) sector to look at India as their next destination to cater to the domestic Indian demand as well as act as an exports hub. To increase exports in ESDM sector from USD 5.5 billion to USD 80 billion by 2020.
Electronics System Design & Manufacturing sector covers electronic hardware products relating to IT and office automation, telecom, consumer electronics, electronic components, etc., It also includes avionics, solar photovoltaic, strategic electronics, nano electronics, medical electronics, space & defence related items, design related activities like product design, chip designing, VLSI, board design, embedded systems etc.
2. Many global players are eyeing India for promoting their products in India vast market, so how do you look this opportunity for electronics sector growth?
Foreign investment is very important for India and it will bring exponential growth to the Indian electronics market. Foreign companies can invest in India, either on their own or as a joint venture. 100% FDI is allowed under the automatic route in ESDM sector. However, in case of defence electronics items, FDI up to 26% is allowed under the government approval route and above 26% is allowed through approval of cabinet committee on security (This is allowed on case to case basis; investments should ensure access to modern and ‘state-of-art’ technology in the country).
3. What are your views on new policy issued to support and enable country to become electronics manufacturing hub? Is India ready to start large scale manufacturing?
Developing Electronics Ecosystem in India is a challenge; but not impossible! It is high time that we look at this situation in a positive light, challenge our circumstances and take a closer look at what is already going on in the country and strengthen the hands of our entrepreneurs by ceaselessly striving to create new opportunities in the Electronics Sector. The National Policy for Electronics (NPE) has clearly paved the way for progress and it is no small achievement that applications worth more than Rs. 15,000 Crores have been received for investments under the M-SIPS Scheme (Modified Special Incentive Package Scheme) and further a whopping Rs 50,000 Crores is committed for the two Semiconductor Fabs recently announced by the Government of India. A quiet awakening and ESDM revolution is underway in India!
In addition to the Policy & eco-system, there is wide acceptance at all levels of government that Electronics manufacturing is a vital issue today. If we ignore and delay the development of this sector, we will be caught in a vicious cycle of imports and deficits. The Indian Rupee has depreciated enough to incentivize exports and make imported finished goods and raw materials more costly. The Indian market continues to expand at a rapid and steady pace giving us the consolation of a sustained demand which all industry hopes and prays for! While economic growth has slowed down, the spread of electronics in all walks of life is so comprehensive, that its demand keeps growing … The list of electronic products & gadgets is unending, LED Lights, Tablets, Laptops, Set Top Boxes, 4G Televisions & Mobiles, Gaming & Internet equipment, Toys, Multimedia Entertainment, Medical Devices you name it and it’s available!
4. What are your suggestions to Govt to sort out issues with respect to electronics manufacturing industry?
ELCINA believes that the government and the industry need to work together to stimulate manufacturing and catalyze an IT/Electronics boom that can contribute significantly to the development of India. ELCINA persistently works to facilitate changes that would strengthen India’s electronics and IT manufacturing base to make it a leader on the world electronics map. Electronics Manufacturing Clusters Scheme aims at providing world-class infrastructure for attracting investments in the ESDM sector. The scheme offers financial support for the development of Electronics Manufacturing Clusters (EMCs) as these EMCs would aid the growth of the ESDM sector, development of entrepreneurial ecosystem, and drive innovation.
We have looked at disabilities in electronics manufacturing long enough and now we must look at our inherent abilities. The only way to succeed is by first bringing to completion that which is most important. We must be self-reliant and manufacture what we can while continuing to expand the range of products and technologies that we can comprehend and increase our manufacturing base. As we understand, what is feasible in India, we must invest in eco-systems to enhance capacities, lower costs and capture domestic and global markets. A significant presence in a few important electronics verticals is vital for an all important ripple effect to take place in the industry and grow exponentially.
5. How are you identifying and reporting electronics manufacturing growth in India? What are the sources you are working?
Some focus areas that can help improve electronics manufacturing growth are by providing the following initiatives:
- Assist in building a better business management capacity and strengthening competitiveness of organizations
- Providing latest information on industry trends, management models, market and advanced technologies
- Infrastructure Support, Creating the right infrastructure in the country that is conducive to growth and development of the country
- R&D Promotion & expertise.
- Provide training programmes for the industry and promote literacy and skill development
- Tax Incentives and rationalisation of the Indian Taxation structure
- Prioritisation of Electronics Hardware Manufacturing as a key focus area
- We need to broaden the markets and create a level playing field for the all players
- Better and cheaper access to financial support to become internationally competitive.
