Electronics sector on high growth track

Any analysis or discussion on the Indian electronics industry should be done in light of the fact that the Indian electronics market is currently worth $118 billion. It exported goods valued at $10.6 billion in 2020-21. The country's domestic production in electronics has increased from $29 billion in 2014-15 to $67 billion in 2021. Also, the global electronic devices market is estimated to be $2.9 trillion. While India's share in the global electronic systems manufacturing industry has grown from 1.3 per cent in 2012 to over 3.6 per cent now, there is ample space for growth.

It does not require any rocket science to understand that the depth in manufacturing is a key requirement to gain self-reliance in any industry and the electronic industry is no exception. A special thrust on designing locally can help achieve this. The government should therefore have a special thrust on designing in every PLI scheme as this will only lead to depth in the manufacturing capabilities of India's electronics industry.

The electronic manufacturing narrative, in particular, is one of growing success and expansion. Companies across the world are beginning to look at the Indian market as their next electronics manufacturing destination to cater to the burgeoning domestic demand for electronic goods. Realizing the sector's potential for growth and its capability to provide large-scale employment, the Modi government is aggressively pursuing the 'Make in India' programme as a core policy initiative to support and speed up the country's manufacturing sector. India can truly be a global manufacturing hub if it effectively harnesses its advantages — ample availability of raw materials, a young workforce, and a large pool of talent with manufacturing and entrepreneurial skills.

Electronics hardware manufacturing has been given high priority as one of the key pillars of the Government of India's 'Make in India', 'Digital India' and 'Start-up India' programmes. The vision document released by the Union Government envisageselectronics manufacturing in India to quadruple to $300 billion by 2026.

Boosting export-led electronic manufacturing will make India's manufacturing globally competitive. The Production Linked Incentive (PLI) schemes that are aimed at promoting domestic manufacturing are likely to give an aggressive push to ensure large multinational companies bring their global manufacturing and supply chains capabilities to India.

India undoubtedly possesses the potential to excel in electronics manufacturing, be it in Electric Vehicles, Artificial Intelligence (AI), Robotics or Biotech & Pharma, and the PLI schemes have set the ball rolling.

The good news from the Indian perspective is that Chennai is now ranked as the world's cheapest foreign direct investment (FDI) location for electronics research and development, as per an assessment, with a total of four Indian cities – Chennai, Bangalore, Pune and Gurgaon – in the top 10 cities in this list. And mind you that R&D is of supreme importance for boosting existing technology and developing new products. R&D helps in enhancing the competitiveness of companies and economies in the same breath.