IT Minister Ravi Shankar Prasad will hold discussions with CEOs of over 50 global technology companies including Apple, Samsung, Vivo, and Xiaomi on Monday, seeking their inputs on opportunities and expectations from the government to make India a powerhouse for the electronics manufacturing sector, IT Secretary Ajay Prakash Sawhney said on Friday.
He said that over $15 billion worth of investment proposals have been received directly by the IT Ministry under its flagship investment scheme.
“Number of factors already make India an attractive destination for electronics manufacturing. There is a huge talent pool, cost competitiveness and all major brands are already here. The value addition being done in India for feature phones have now increased to 25 per cent from 11 per cent earlier. In case of smart phones, it is now 18 per cent.
“We have embarked upon major policy changes already stepping up from small clusters policy where 50 acres land were given to the companies… now 200 acres are being proposed to be given under ‘Anchor units clusters’ where companies will be encouraged to have a supply chain also to develop a full eco system. Our aim is to encourage larger clusters,” Sawhney said on a curtain raiser briefing.
Other ministries including Finance and Department for Promotion of Industry and Internal Trade will also be there.
In August, the government relaxed rules for foreign direct investment (FDI) for single brand retail under which definition of 30 per cent domestic sourcing expanded to include exports from third party manufacturers. This, in turn, is expected to help foreign handset makers operating in India to meet the requirements easily and open retail stores that they would own completely and operate.
Seen as a step to lure Apple, Oneplus and others, the government now wants to reach out to the entire global electronics industry for doing more business in India.
The government has allowed online retailing before opening physical stores under single-brand retail and relaxed the rule of mandatory brick-and-mortar stores while expanding definition of mandatory 30 per cent domestic sourcing norm.
India’s smartphone industry is expected to witness a surge in turnover during the next four to five years, with the domestic market demand expected to surge from the current $25 billion to $80 billion by 2025, as per the National Policy on Electronics (NPE), 2019.
“National Policy on Electronics 2019 envisions positioning India as a global electronics hub by encouraging and driving capabilities in the country for developing core components (including chipsets), and creating an enabling environment for the industry to compete globally. MeitY (Ministry of Information Technology) is planning to embark upon a comprehensive investment and trade promotion programme to make Electronics India a brand synonymous with the next electronics hub,” the IT Secretary said.
Around 50 industry leaders have confirmed their participation in the round table to deliberate upon the mutual expectations from the government and the industry, to achieve the true potential of domestic electronics manufacturing and the measures required to achieve it, he added.
The electronics sector, spanning mobile handsets, consumer electronics, strategic electronics, medical devices, IT, electronic manufacturing services, electronic components, telecom and LED lighting, among others, will be there for discussion where key industry leaders from Apple, Samsung, Vivo, Oppo, Lava, Qualcomm, Xiaomi, Dell, HP, Philips, Bosch, Cisco, Flextronics, Foxconn, Nokia, LG, Panasonic, TDK, Intel, AMD, Wistron, will be present, he said.
Sawhney said the government attaches high priority to domestic electronics hardware manufacturing and it is one of the important pillars of “Make in India”.
Highlighting the electronics sector, he said that over $15 billion worth of investment proposals received directly by the Ministry of Electronics and IT under its flagship investment scheme and domestic manufacturing has grown from $29 billion (in 2014-15) to $70 billion (in 2018-19).
He said India has emerged as 2nd largest manufacturer of mobile handsets in the world and one of the world’s largest mobile manufacturing facility is based in India, while the manufacturing units for LCD/ LED TVs have gone up from 25 to 35 units. Number of LED lights manufacturing units has gone up from 10 to 128 units and has generated employment for over 20 lakh persons across the country.
Sawhney said that lately, exports of electronics goods have started growing rapidly.
“There is a significant scope for growth in this sector with the burgeoning domestic market, which is estimated to reach $400 billion by 2025. With its strengths in market, technology talent pool, rapidly growing competitive economy and positioning in global dynamics, India truly holds the potential to become the ‘Electronics Factory’ of the world,” he added.