The electronics system design and manufacturing industry (ESDM)[i] is blessed in India right now. Not only does India have the 3rd largest pool of scientists in the world, but as the population booms so does the market for consumer electronics. Furthermore, Government schemes like the National Knowledge Network (NKN), National Optical Fibre Network (NOFN), tablets for the Education sector, a digitization policy and various broadband schemes support the development of the industry. The overall ESDM market in India grew at an estimated 9.9 percent between 2011 and 2015 resulting in an industry forecast to be worth $94.2 billion by the end of 2015; and consumer demand alone is estimated to reach USD 29 Billion by 2020 due to the significant local demand.
Although the electronics product market is growing a very fast pace, ironically most of the demand is being fulfilled by imports. Declining prices and increasing affordability are anticipated to propel domestic demand, but there are a number of local barriers to filling this demand that require addressing. Favorable policies to incentivize investment, adoption of new technologies, catalyzing innovation & entrepreneurship, enhancement of skills and addressing the costs of developing products domestically are all key ingredients to elevating India to a leading player in the global arena.
The market for electronic products is expected to reach $74.6 billion in 2015 – including exports of $9.7 billion. Total domestic manufacturing contributes only 35% of this demand and the remaining 65% is met through imported products. The top 10 electronic products by total revenue are mobile phones, flat panel display TVs, notebooks, desktops, digital cameras, inverters / UPS, memory cards/USB drives, EMS/LCD monitors and servers.
The electrical machinery sector reported a 10.5% rate of market expansion between 2007-2012 – including USD 4.9 Billion of exports in 2013-14. The sector reports a 14.8% yearly increase in exports in the last 8 years and is anticipated to reach US$ 100 billion in 2022.
Market-oriented reforms, such as the target of “Power for All” and plans to add 88.5 GW of capacity by 2017 and 93 GW by 2022 – as well as increasing scope for direct exports to neighboring countries – will increase the demand for electrical machinery. Indian manufacturers are becoming more competitive in their product designs, manufacturing and testing facilities and investments in research and development in the electrical machinery industry are amongst the largest in India’s corporate sector. This will result in advancements in technology and a large pool of human resources. The electrical machinery industry has been de-licensed, which has facilitated the entry of global majors into the electrical machinery industry in India.
All in all there is great promise in the ESDM sectors in the coming years, which will be discussed in depth in the interactive workshop “Success in India” organized by Zvei Academy and M+V on the 8th of July in Frankfurt am Main.
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[i] ESDM: Electronics Products; Electronic Components; Semiconductor Design and Electronics Manufacturing Services (EMS)