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Home / News / Business News / Indian electronic products industry to touch $75 billion by 2017
  • Business

    Indian electronic products industry to touch $75 billion by 2017

    Akriti Asthana
    Written by
    Akriti Asthana
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    Last updated on Sep 20, 2016, 08:00 am
    Indian electronic products industry to touch $75 billion by 2017
  • According to the joint study, government's efforts for infrastructure development, locomotive and energy, pose an important opportunity for rapid-expansion of domestic electronics industry.

    It is expected to reach $75 billion by 2017 from $61.8 billion in 2015 with rise in penetration across consumer-products, especially in semi-urban and rural markets.

    Indian electronic components industry was valued at $13.5 billion in 2015.

  • In this article
    The 'Make in India' dream for hardware and electronics industry India- an attractive hub for manufacturers? India's taxation system Challenges faced by Indian electronic products industry Lack of facilities
  • Report

    The 'Make in India' dream for hardware and electronics industry

    The 'Make in India' dream for hardware and electronics industry
  • The electronic components industry in India grew from $10.8 billion in 2013 to $13.5 billion in 2015 at a CAGR of 11%.

    The market is dominated by electro-mechanical components, like PCB and connectors which form 30% of the total-demand, followed by passive components, like resistors and capacitors, at 27%.

    India's attractiveness for manufacturers is increasing due to the availability of low-cost labour.

  • Information

    India- an attractive hub for manufacturers?

    India- an attractive hub for manufacturers?
  • Rising manufacturing costs in China and Taiwan are compelling manufacturers to shift their manufacturing base to alternate markets.

    In 2014, the average manufacturing labor cost per hour in India was $0.92 as compared to $3.52 of China.

    However, the Indian manufacturing ecosystem for electronics and hardware industry is still at a nascent stage and faces various demand side as well as supply side challenges.

  • Details

    India's taxation system

    India's taxation system
  • Currently, the base direct tax incidence in India stands at around 30%, whereas the corresponding tariff in other Asian countries is between 16-25%.

    Even after the proposed implementation of Goods and Services Tax, there still are clarity concerns regarding revenue-neutral rate, non-creditable tax on inter-state movement of goods, status of existing state incentives granted and transition from existing taxation system to GST regime.

  • Limitations

    Challenges faced by Indian electronic products industry

    Challenges faced by Indian electronic products industry
  • Since Indian manufacturing ecosystem is still in a nascent stage, scale of operations and local component demands are limited, resulting in reduced cost-competitiveness.

    Component demand is muted due to limited value-addition as primarily last-mile assembly takes place.

    High electronic content is not added in products due to limited industry-specific standards.

    Primary sales are limited due to reduced disposable income in semi-urban and rural markets.

  • Challenges

    Lack of facilities

    Lack of facilities
  • In India, there is unavailability of good roads, power, water, telecommunications, ports and logistics, even in established industrial estates.

    Lack of proper roads and sales infrastructure results in distribution challenges in semi-urban cities and remote villages.

    There is port congestion due to unavailability of containers and long-documentation process.

    With changing technology, labor needs constant training as electronics-manufacturing industry has high dependence on skilled manpower.

  • India
  • GST
  •  
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