New Delhi, India, September 26, 2014: Building momentum on his vision, Prime Minister Narendra Modi yesterday shared his agenda and action points towards realizing the domestic manufacturing agenda. The Chairman of India Electronics and Semiconductor Association (IESA), the premier body for the ESDM industry in the country who had the privilege of being part of the invited delegates, congratulated this mega initiative by the Prime Minister on behalf of the association.
The ‘Make in India’ program included huge concentration on Electronic systems and Design manufacturing. The PM during his address stressed the need to build a positive atmosphere that India is investor friendly and create the optimism that it is easy to do business in India with eradication of the red tapes, lengthy processes and complicated tax laws.
ICICI Bank MD, Ms. Chanda Kochhar talked about the growing demand for electronics hardware in India which is projected to increase to USD 400 billion by 2020 and emphasized concern on the country’s electronics import bill surpassing its oil import bill. PM also mentioned the fact that FDI will be crucial for the ESDM sector from the perspective of First Develop India.
Witnessing the Prime Minister announce the Make in India agenda live, Mr. Ashok Chandak, Chairman of IESA said, “Make in India is a government initiated program aimed at expanding the pie of opportunities to create a positive spiral (Chakra) effect of employment, purchasing power, spending and supply. We believe Make in India is to create an Orbit Changing Atmosphere which will be conducive for major breakthroughs in the design led manufacturing. IESA has been advocating India’s stance as an ESDM powerhouse and we’re glad to see the PM’s initiative towards making India a preferred manufacturing destination encompassing 25 sectors that includes ESDM and several other sectors that rely heavily on electronics. The “3D composition of Democracy – Demography – Demand” will have a multiplier effect on the over contribution of manufacturing in the GDP with potential to take it from 15% to 25% in the future.”
“IESA has been committed to dream big and has done extensive work around ESDM policies and played a key role in fab approval and setting up of Electronic Manufacturing Clusters all in line with Make in India. We have been driving the vision of ‘Design Led Manufacturing’ for ESDM sector as believe that domestic creation is the way forward for India to be competitive and successful. This becomes much more relevant and important to help realize the Make in India vision,” added Mr. Chandak.
The involvement of the industry is also expected to bring a vision of being unified on the purpose and aligned on the actions. IESA believes that the government is moving towards the right direction; however efficient execution will lead to success. This has already brought positive vibes among the global companies who intend to invest in India particularly, in ESDM and Semiconductor space; where the majority of the market share in India has been held by global companies.
The Make in India program has huge thrust on Electronics Systems and Defense Manufacturing:
India is poised to become a USD 29 Billion consumer electronics market by 2020 and the demand is projected at USD 94.2 Billion by 2015. Currently, 65% of the demand for electronic products is met by imports and there is steep rise in manufacturing costs in alternate markets.
In order to meet the rising demand, aggressive boost needs to be given to the Electronic Manufacturing Services (EMS) industry which will be a significant contributor to the entire industry’s development. The abundant skilled manpower in semiconductor design and embedded software and strong design and R&D capabilities in electronics are also going to be huge growth drivers.
IESA along with PwC released key highlights of a research report on the Aerospace & Defense market in India. According to the report, India’s Defense budget has grown to INR 224k crores, with 40% of it allocated to capital spends and this may grow to INR 137-154k Cr by 2018. With the growth in demand, Electronic Manufacturing Services (EMS) organizations are expected to provide employment to more than two lakh skilled and semi-skilled workers by 2015. While India has high electronics design competencies, this unfortunately has limited impact on indigenous R&D and manufacturing contribution in the Aerospace and Defense sector; making India one of the largest equipment importers in this sector. Therefore the time has come for India to focus on defense electronics and carve a niche for itself in ESDM sector.