Page 32 - CII Artha Magazine 1
P. 32

the sector has gone up from Rs.
                                                                                                                                                                                                                                 also evident from the annual
                                                                                                                                                                                                                                                                                                                                                         depends entirely on imports
                                                                                                                                                                                                      1,90,366 crore (US$27.20
                                                                                                                                                                                                                                 import bill which has
                                                                                                                                                                                                                                                                                                                                                         for its semiconductor needs.
                                                                                                                                                                                                                                 escalated from Rs. 2,29,615
                                                                                                                                                                                                                                                                                                                                                         Already, electronics attracts
                                                                                                                                                                                                      billion) in 2014-15 to about Rs.
                                                                                                                                                                                                      5,33,550 crore (US$76.0
                                                                                                                                                                                                                                                                                                                                                         the second highest import
                                                                                                                                                                                                                                 crore 2014-15 to Rs. 3,85,081
                                                                                                                                                                                                                                 crore in 2019-20 marking a
                                                                                                                                                                                                                                                                                                                                                         bill and semiconductors
                                                                                                                                                                                                      billion) in 2019-20, exhibiting an
                                                                                                                                                                                                                                                                                                                                                         account for a significant
                                                                                                                                                                                                      impressive CAGR of 23 per
                                                                                                                                                                                                                                 CAGR of 10.89 per cent.
                                                                                                                                                                                                                                                                                                                                                         portion.
                                                                                                                                                                                                      cent.
                                                                                                                                                                                                      What is notable is that India has
                                                                                                                                                                                                                                                                                                                                                         There is need to incentivize
                                                                                                                                                                                                      emerged as a leading
                                                                                                                                                                                                                                                                                                                                                         production of the high-tech
                                                                                                                                                                                                                                                                                                                                                         sectors such as
                                                                                                                                                                                                      manufacturer of mobile phones
                                                                                                                                                                                                      in recent years. In FY20, mobile
                                                                                                                                                                                                                                                                                                                                                         semiconductors in the
                                                                                                                                                                                                      phone manufacturing
                                                                                                                                                                                                                                                                                                                                                         country. As per CII study, the
                                                                                                                                                                                                                                                                                                                                                         development of these
                                                                                                                                                                                                      accounted for 41 per cent of
                                                                                                                                                                                                                                                                                                                                                         industries entails huge
                                                                                                                                                                                                      total production of the sector,
                                                                                                                                                                                                                                                                                                                                                         investments and hence need
                                                                                                                                                                                                                                 In view of its pivotal role in
                                                                                                                                                                                                      followed by industrial
                                                                                                                                                                                                                                                                                                                                                         significant Government
                                                                                                                                                                                                                                 realising the US$5 trillion
                                                                                                                                                                                                      electronics (18 per cent),
                                                                                                                                                                                                                                                                                                                                                         support, both monetary (may
                                                                                                                                                                                                                                 economy dream in near
                                                                                                                                                                                                      consumer electronics (16 per
                                                                                                                                                                                                                                                                                                                                                         account for more than half of
                                                                                                                                                                                                                                 future, the government has
                                                                                                                                                                                                      cent), electronic components
                                                                                                                                                                                                      (15 per cent), strategic
                                                                                                                                                                                                                                 identified electronics
                                                                                                                                                                                                                                                                                                                                                         the total project’s cost) and
                                                                                                                                                                                                      electronics (6 per cent) and
                                                                                                                                                                                                                                 manufacture as a thrust
                                                                                                                                                                                                                                                                                                                                                         non-monetary (including
                                                                                                                                                                                                                                                                                                                              growth of the sector. Some
                                                                                                                                                                                                                                                                                                  again a logical step to augment
                                                                                                                                                                                                                                                                       Components and
                                                                                                                                                                                                      computer hardware (4 per
                                                                                                                                                                                                                                 sector in policy formulation
                                                                                                                                                                                                                                                                                                                                                         semiconductor-grade
                                                                                                                                                                                                                                                                                                  the electronics manufacturing
                                                                                                                                                                                                                                                                                                                              of the challenges include
                                                                                                                                                                                                                                                                       Semiconductors (SPECS) and
                                                                                                                                                                                                      cent).
                                                                                                                                                                                                                                 to boost electronics
                                                                                                                                                                                                                                                                                                                                                         infrastructure requirements,
                                                                                                                                                                                                                                                                                                  capabilities in the country
                                                                                                                                                                                                                                                                                                                              infrastructure deficiency
                                                                                                                                                                                                                                                                       Modified Electronics
                                                                                                                                                                                                                                 manufacturing in India, reduce
                                                                                                                                                                                                                                                                                                                                                         land and preferential market
                                                                                                                                                                                                                                                                       Manufacturing Clusters
                                                                                                                                                                                                                                                                                                  while the Modified Electronics
                                                                                                                                                                                                                                                                                                                              such as shortage of
                                                                                                                                                                                                                                 import dependence and
                                                                                                                                                                                                      Similarly, major strides have
                                                                                                                                                                                                                                                                                                                                                         access); as has been the case
                                                                                                                                                                                                                                                                                                  Manufacturing Clusters
                                                                                                                                                                                                                                                                                                                              high-quality power, deficien-
                                                                                                                                                                                                                                                                       Scheme (EMC 2.0). A fourth
                                                                                                                                                                                                      been made towards
                                                                                                                                                                                                                                 increase exports.
                                                                                                                                                                                                                                                                                                                                                         in countries which are global
                                                                                                                                                                                                                                                                                                                              cies in transportation/logis-
                                                                                                                                                                                                                                                                                                  Scheme (EMC 2.0) is specially
                                                                                                                                                                                                                                                                       scheme, namely the
                                                                                                                                                                                                      increasing exports of
                                                                                                                                                                                                                                                                                                                                                         leaders like Taiwan, South
                                                                                                                                                                                                                                                                                                  tailored to provide the
                                                                                                                                                                                                                                                                       Production Linked Incentive
                                                                                                                                                                                                                                                                                                                              tics, high cost of finance,
                                                                                                                                                                                                      electronics items. As per
                                                                                                                                                                                                                                                                                                                                                         Korea, Israel and China.
                                                                                                                                                                                                                                 The National Policy on
                                                                                                                                                                                                                                                                                                                              inadequacy of domestic
                                                                                                                                                                                                                                                                                                  requisite infrastructure to
                                                                                                                                                                                                                                                                       Scheme (PLI) for IT Hardware
                                                                                                                                                                                                      DGCI&S data, India’s exports
                                                                                                                                                                                                                                 Electronics (NPE) 2019 seeks
                                                                                                                                                                                                                                                                                                                              supply chain, complex
                                                                                                                                                                                                                                                                       was notified in March 2021.
                                                                                                                                                                                                                                                                                                  promote the establishment of
                                                                                                                                                                           computer hardware and
                                                                                                                                                                                                                                                                                                                                                         In this context, the recent
                                                                                                                                                                                                      have grown from Rs. 38,263
                                                                                                                                                                                                                                 to change the electronics
                                                                                                                                                                                                                                                                                                  greenfield and brownfield
                                                                                                                                                                                                                                                                                                                              regulatory system, limited
                                                                                                                                                                           strategic electronics
                                                                                                                                                                                                      crore in 2014-15 to Rs.
                                                                                                                                                                                                                                 landscape of the country by
                                                                                                                                                                                                                                                                                                                                                         incentive package worth
                                                                                                                                                                                                                                                                                                                              R&D, among others. In
                                                                                                                                                                                                                                                                                                  electronic manufacturing units
                                                                                                                                                                                                                                                                       The production linked
                                                                                                                                                                           (aerospace and defence). Of
                                                                                                                                                    he electronics industry,
                                                                                                                                                                                                      82,929 crore in 2019-20,
                                                                                                                                                                                                                                 positioning India as a global
                                                                                                                                                                                                                                                                                                                                                         Rs.76,000 crore announced
                                                                                                                                                                                                                                                                                                                              addition, the absence of an
                                                                                                                                                                                                                                                                                                  within the cluster to promote
                                                                                                                                                                                                                                                                       incentive (PLI) scheme for
                                                                                                                                                                           these, three segments namely
                                                                                                                                                    considered to be the
                                                                                                                                                                                                      notching an impressive CAGR
                                                                                                                                                                                                                                 hub for domestic
                                                                                                                                                                                                                                                                                                                                                         by the government for the
                                                                                                                                                                                                                                                                                                  innovation and steer growth in
                                                                                                                                                                                                                                                                       large scale electronics
                                                                                                                                                                                                                                                                                                                              adequate manufacturing base
                                                                                                                                                                           communication and broadcast
                                                                                                                                                bedrock of every other
                                                                                                                                                                                                                                                                                                                                                         development of
                                                                                                                                                                                                      of 16.73 per cent.  Indian
                                                                                                                                                                                                                                 manufacturing and export in
                                                                                                                                                                                                                                                                       manufacturing, mobile phone
                                                                                                                                                                                                                                                                                                  the sector.
                                                                                                                                                                                                                                                                                                                              for different components viz,
                                                                                                                                                                           equipment, industrial
                                                                                                                                                manufacturing activity in the
                                                                                                                                                                                                                                                                                                                                                         semiconductors and display
                                                                                                                                                                                                      exporters are also gradually
                                                                                                                                                                                                                                 the entire value-chain of
                                                                                                                                                                                                                                                                       manufacturing and specified
                                                                                                                                                                                                                                                                                                                              semiconductors, passive and
                                                                                                                                                                           electronics and consumer
                                                                                                                                                country, has the potential to
                                                                                                                                                                                                      getting integrated in the
                                                                                                                                                                                                                                 Electronics System Design
                                                                                                                                                                                                                                                                                                                                                         manufacturing ecosystem, is
                                                                                                                                                                                                                                                                       electronic components as well
                                                                                                                                                                                                                                                                                                  The wide array of calibrated
                                                                                                                                                                                                                                                                                                                              electromechanical compo-
                                                                                                                                                                           electronics comprise around
                                                                                                                                                hasten our quest of emerging
                                                                                                                                                                                                      global value chain.
                                                                                                                                                                                                                                 and Manufacturing (ESDM).
                                                                                                                                                                                                                                                                                                                                                         laudable. The scheme , which
                                                                                                                                                                                                                                                                                                  and well-crafted measures
                                                                                                                                                                                                                                                                                                                              nents etc is a deterrent to
                                                                                                                                                                                                                                                                       as the PLI for IT hardware,
                                                                                                                                                                           75 per cent of the overall
                                                                                                                                                as a hub of global
                                                                                                                                                                                                                                                                                                                                                         would cover companies
                                                                                                                                                                                                                                 The aim is to achieve a
                                                                                                                                                                                                                                                                       medical devices including
                                                                                                                                                                                                                                                                                                  introduced by the government
                                                                                                                                                                                                                                                                                                                              investors as it increases the
                                                                                                                                                                           share of the market for
                                                                                                                                                manufacturing, technology
                                                                                                                                                                                                                                 turnover of US$300 billion by
                                                                                                                                                                                                      Besides, the sector is showing
                                                                                                                                                                                                                                                                                                                                                         engaged in silicon
                                                                                                                                                                                                                                                                                                                              dependence on imports.
                                                                                                                                                                                                                                                                       electronics has been described
                                                                                                                                                                                                                                                                                                  together with growing
                                                                                                                                                                           electronics industry.
                                                                                                                                                and innovation. A flourishing
                                                                                                                                                                                                      remarkable growth in
                                                                                                                                                                                                                                 2025-26. It estimates that
                                                                                                                                                                                                                                                                                                                                                         semiconductor fabs, display
                                                                                                                                                                                                                                                                                                  demand, rising disposable
                                                                                                                                                                                                                                                                       as a game changing initiative
                                                                                                                                                electronics industry, through
                                                                                                                                                                                                                                 about 10 million jobs will be
                                                                                                                                                                                                                                                                                                                                                         fabs, compound
                                                                                                                                                                                                      demand. In fact, demand for
                                                                                                                                                                                                                                                                       for promoting local
                                                                                                                                                                                                                                                                                                                              Some of the constraints and
                                                                                                                                                                                                                                                                                                  incomes, the digital India vision,
                                                                                                                                                its ability to create value and
                                                                                                                                                                                                                                 created from the
                                                                                                                                                                                                      electronics hardware in India
                                                                                                                                                                                                                                                                                                                                                         semiconductors, silicon
                                                                                                                                                                                                                                                                                                                              the remedial measures to
                                                                                                                                                                                                                                                                                                  among others would
                                                                                                                                                                                                                                                                       electronics manufacturing in
                                                                                                                                                jobs, can also contribute
                                                                                                                                                                                                      is anticipated to perk up from
                                                                                                                                                                                                                                 implementation of NPE.
                                                                                                                                                                                                                                                                                                                                                         photonics, sensors fabs,
                                                                                                                                                                                                                                                                                                  encourage domestic players to
                                                                                                                                                                                                                                                                                                                              help the industry are
                                                                                                                                                                                                                                                                       the country. The scheme is
                                                                                                                                                significantly to bringing
                                                                                                                                                                                                                                                                                                                                                         semiconductor packaging
                                                                                                                                                                                                      US$127 billion in 2019 to
                                                                                                                                                                                                                                                                                                  make forays into the sector.
                                                                                                                                                                                                                                                                       also expected to attract global
                                                                                                                                                                                                                                                                                                                              elucidated below.
                                                                                                                                                dynamism to our
                                                                                                                                                                                                      reach US$300 billion by
                                                                                                                                                                                                                                 Similarly, in consonance with
                                                                                                                                                                                                                                                                                                                                                         and semiconductor design,
                                                                                                                                                                                                                                                                       investments, facilitate
                                                                                                                                                development journey. What is
                                                                                                                                                                                                                                 the credo of Make in India,
                                                                                                                                                                                                                                                                                                                                                         would not only help to
                                                                                                                                                                                                      2025-26. This surge in demand
                                                                                                                                                                                                                                                                                                                              A. Encouraging High Value,
                                                                                                                                                                                                                                                                       investments in innovation,
                                                                                                                                                                                                                                                                                                  Despite the above, the
                                                                                                                                                also significant is that its
                                                                                                                                                                                                      is huge which brings a big
                                                                                                                                                                                                                                 Digital India and Atmanirbhar
                                                                                                                                                                                                                                                                                                                                                         address the global shortage
                                                                                                                                                                                                                                                                                                  electronics industry is beset
                                                                                                                                                                                                                                                                       technological upgradation and
                                                                                                                                                                                                                                                                                                                                High volume
                                                                                                                                                applications are being
                                                                                                                                                                                                                                 Bharat Abhiyan, and to realise
                                                                                                                                                                                                      opportunity for the industry.
                                                                                                                                                                                                                                                                                                                                                         of semiconductors but
                                                                                                                                                                                                                                                                                                  with numerous disabilities
                                                                                                                                                                                                                                                                                                                                Manufacturing such as
                                                                                                                                                                                                                                                                       research and make India an
                                                                                                                                                increasingly utilized by almost
                                                                                                                                                                                                                                                                                                                                                         would also go a long way
                                                                                                                                                                                                                                 the vision of the National
                                                                                                                                                                                                      However, unless there is a
                                                                                                                                                                                                                                                                       integral part of the global
                                                                                                                                                                                                                                                                                                                                Semiconductors
                                                                                                                                                                           Responding to the impetus
                                                                                                                                                all segments of the economy.
                                                                                                                                                                                                      huge ramp up in domestic
                                                                                                                                                                                                                                                                                                                                                         toward making India an
                                                                                                                                                                                                                                 Policy on Electronics 2019,
                                                                                                                                                                                                                                                                       supply chain.
                                                                                                                                                                           provided by the government’s
                                                                                                                                                                                                                                                                                                                                                         electronics hub.
                                                                                                                                                                                                                                 the government launched
                                                                                                                                                                                                      capacity, it is likely that the
                                                                                                                                                                                                                                                                                                                              The country does not have
                                                                                                                                                                           ‘Make in India’, Atmanirbhar
                                                                                                                                                The electronics industry is
                                                                                                                                                                                                                                 three major incentive
                                                                                                                                                                                                      incremental demand would be
                                                                                                                                                                                                                                                                                                                              enough presence in the
                                                                                                                                                                                                                                                                       The Scheme for Promotion of
                                                                                                                                                                           Bharat, Digital India and Smart
                                                                                                                                                classified into six broad
                                                                                                                                                                                                                                                                                                                                                         Further, MeitY’s recent EOI
                                                                                                                                                                                                      met through a rise in imports.
                                                                                                                                                                                                                                 schemes in 2020 to support
                                                                                                                                                                                                                                                                                                                              indigenous manufacturing of
                                                                                                                                                                                                                                                                       Manufacturing of Electronics
                                                                                                                                                                           City initiatives, the electronics
                                                                                                                                                segments viz. communication
                                                                                                                                                                                                                                 local manufacturing. These
                                                                                                                                                                                                      It also needs to be noted that
                                                                                                                                                                                                                                                                                                                                                         for inviting companies to set
                                                                                                                                                                                                                                                                       Components and
                                                                                                                                                                                                                                                                                                                              high value components such
                                                                                                                                                                           industry has made noteworthy
                                                                                                                                                and broadcast equipment
                                                                                                                                                                                                                                 include the Production Linked
                                                                                                                                                                                                      the country specializes in low
                                                                                                                                                                                                                                                                                                                                                         up semiconductor and display
                                                                                                                                                                                                                                                                                                                              as semiconductors which are
                                                                                                                                                                                                                                                                       Semiconductors (SPECS),
                                                                                                                                                                           progress in terms of production
                                                                                                                                                (including mobile phones),
                                                                                                                                                                                                                                                                                                                                                         fabs is a welcome step and
                                                                                                                                                                                                                                 Incentive Scheme (PLI),
                                                                                                                                                                                                      tech content and most
                                                                                                                                                                                                                                                                                                                              extensively used by the
                                                                                                                                                                                                                                                                       which targets the
                                                                                                                                                                           and growth in the last five years.
                                                                                                                                                consumer electronics,
                                                                                                                                                                                                                                                                                                                                                         should be pursued further.
                                                                                                                                                                                                                                 Scheme for Promotion of
                                                                                                                                                                                                      high-tech components are
                                                                                                                                                                                                                                                                                                                              electronics industry. For
                                                                                                                                                                                                                                                                       development of the
                                                                                                                                                                           This is borne out from the fact
                                                                                                                                                industrial electronics,
        Expert Speak                                                                                                                            Introduction               electronic components,     that the value of production in   presently imported. This is    Manufacturing of Electronic   components’ ecosystem, is   which restrict the potential   example, the country
 B. Deepening the   supported CAS (conditional
 Component Value Chain   access system) for set top
 across the entire   boxes.
 ecosystem
 Similarly, a global innovation
 The domestic electronics   challenge for designing of                    Dr Rakesh Mohan
 industry is characterised by   semiconductors and chip sets   INDIA NEEDS TO  Member (Part-Time) Economic Advisory
 lack of a component   for educational tablets for the   GET INTO         Council to the Prime Minister of India and
 ecosystem which leads to its   masses could be encouraged.  SEMI-CONDUCTOR   President & Distinguished Fellow,
 MANUFACTURING
 dependence on imports. High   TO OVERCOME IT                             Centre for Social and Economic Progress
 dependency on imported   Besides, the next focus should   SHORTAGE
 inputs raises cost and impedes   be on maximizing domestic   trends, seizing the   There is a need for a third-generation reforms aimed at leapfrogging its growth trajectory
 competitiveness. A right mix   value addition and promoting   opportunity of Designing in   Dr Krishnamurthy   to the next level of around 8-9 per cent which would ensure a doubling of per capita
 of policy realignment coupled   Design in India, besides Make   India and Making in India, and   journey in the semiconductor   Subramanian  income in coming decades. There is also a need for a regulatory standards-setting authority
                                           which is technologically competent to deliver on the third-generation reforms.
 with new targets is required.     in India. For this, the   learn from mistakes of the   sector is more likely to start
 know-how available with   past. There were a large   with assembly, testing,   Chief Economic Advisor,
          Ministry of Finance,
 number of SMEs in
 The government has, no doubt   Government owned R&D   electronics before the   marking, and packaging   Government of India
 announced the PLI scheme for   laboratories should be made   Information Technology   (ATMP) and specialty fabs.
 components. However, the 5-6   freely accessible to  industry,   n the middle of the global   origin tech captains steering   Agreement (ITA) of WTO   We should stick to the large   There is an impelling need to
 per cent incentive on   outsourced R&D needs to be   pandemic, India generated   global tech companies.   National Policy on Electronics   came into effect resulting in   volumes and produce   improve the competitiveness of
 incremental sales, envisaged   incentivized on the lines of   considerable interest with its   So, we have the ability, and   (2019), Production Linked   the closure of many SMEs.   something that is very huge.   the manufacturing sector
 unicorn boom. The
 under the scheme, is not   In-house R&D, Technology   unprecedented performance   government policies too are   Incentive (PLI) Scheme for   With zero duty kicking in,   We are skilling rapidly to   There is no longer any need   distribution of Chinese   And today, the shortage is in   which in turn would help in job
 enough to achieve scale in this   Acquisition Fund be created   has been a showcase of sorts   moving us towards   the electronics sector, the   many local brands got killed,   achieve self-reliance. For   to just assemble products   phones is done by Chinese   the in the lower end, the   creation and promote inclusive
          growth. The government
 companies. We have become
 example, we have VLSI design
 here.  We are trying to push
 sector and accordingly would   for liberal assistance in filing   for its appetite for adventure,   atmanirbharta (self-reliance).   SPECS Scheme, Electronics   as they couldn't compete with   courses, courses for SMT   into a higher gear with   a sort of a colony of the   higher end like 7 nm process   recognizes that the high cost of
 the pricing offered by China.
 Manufacturing Clusters (EMC
 discourage manufacturers   patents and a Guarantee Fund   talent for new tech and an   Since electronics is a meta   2.0) Scheme, and several   So, a lot of work needs to be   (surface mount technology)   manufacturing, getting into a   Chinese in that matter. Now   is difficult and extremely   doing business – such as
 from indigenizing production.   be created to help R&D   entrepreneurial mindset.   resource for all verticals, the   other interventions designed   done to bring SMEs back   manufacturing, courses for   deeper level of manufacturing.   the opportunity has come for   expensive to put up too.   logistics, power, credit, etc - has
 Hence, the government should   houses to raise working   India’s contribution as the   government’s aim to hit   to promote indigenous   onto the mainstage.  tool design. So people are   PLI has helped to get the   a lot of companies, like Lava   Geo-politics may have had a   impacted manufacturing   Mr Uday Kotak  Mr Sanjiv Bajaj  Mr Ajay S Shriram
 review the scheme by   capital.  digital shop of the world,   US$250 billion (domestic   manufacturing.  being trained in all these   scale which will make   and Micromax, to come back,   hand in the present   competitiveness and has   Immediate Past   President-Designate,
 thanks to its software
 semi-conductor shortage.
 electronics manufacturing) by
 expanding the incentive from   engineering talent, is well   2025-26 (from about US$70   When we start designing in   areas. AR/VR across four lakh   production economically   because they are also getting   Trump banned the export of   likewise taken remedial   President, CII and   CII and Chairman &   Past President,
                                                                                               CII and Chairman &
 the present 5-6 per cent and   D. Other Suggestions  known. We have been the   billion in 2021) comes at an   It’s also a fact that despite our   India, we will see more of   common services centres   viable. Our electronics goods   PLI benefits. But they must   hardware and software for   measures, by undertaking   Managing Director &   Managing Director,  Senior Managing
 (CSCs) in villages is helping in
 invest in design in India.
 import bill is second only to
          labour reforms, power sector
 widen the eligibility criteria. A   leading IT sourcing   opportune moment when   huge talent advantage and   depth, more components will   education as well. Recently,   the country’s oil import bill.   semiconductor manufacturing.   reforms, MSME policy etc   CEO Kotak Mahindra   Bajaj Finserv Limited  Director,
 be available in India, though
 government push, we are still
 revamped PLI would facilitate   Similarly, the government   destination across the world,   there is fresh zeal to get out   lagging on the depth of   some may still be imported.   Foxconn set up an R&D   According to the Meity and   We need to get extensively   Europe has taken a   which would reduce operating   Bank Limited  DCM Shriram Limited
 scale economies from   should also look at other   accounting for 55 per cent   of the Covid storm.  manufacturing through design   Some components like   centre in Chennai, in IIT   Invest India data figures,   into making chips. The   semiconductor chip decision.   costs and encourage industry   Very often I have been   Capabilities and access   India has a unique
 domestic production and also   options such as leveraging   market share of the   and domestic value addition.   passives etc are already   Madras, and the company is   import of electronics was   reigning mega technologies AI   The next wars are going to   to build scale.  asked what is the new   to finance, research &   opportunity to
 encourage SMEs to strengthen   upcoming FTAs (UK & the   US$200-250 billion global    The government is keen on   When we talk of new and   available for use. When we   planning to design products in   recorded at Rs 3,85,081 crore   and ML are   be fought with   world gonna be? I define   development and   position itself in the
 services sourcing business in
 providing an enabling
 semiconductors.
 the supply chain and reduce   EU) towards enhancing   2019-20.   environment, with the Make   emerging technologies, we   start making in India, we will   India.  (US$54.4 billion) in 2019-20,   compute-intensive, and   it as a world that is never   manufacturing, are   overarching dynamics
 our dependence on imports.  exports, incentivizing   in India   talk of a new era in mobility,   be defining the components   We need to think locally.   and Rs 3,99,374 crore (US$54   massive amounts of data are   Moreover, design and   normal, next normal, and   spread across the   of the world and
 needed to proceed.
 billion) in 2020-21 (a slight
 manufacture of products not   Global captive centres in India   program,   communications, connectivity   which would be used in the   Designing for India means   decrease in US$ terms albeit   Specialised chips can do that   manufacture in India helps to   new normal. Choose any   globe. Therefore, a   become one of the key
 and discovery, like EVs and
 country.  And when we define
 C. Encouraging Design-led   currently produced in India,   are transforming into test   drones, space tech, backhaul   the components we need, we   that we need to look at   an increase in Rupee terms).  more efficiently, especially in   ward off threat from sources   of these Ns and maybe   globally coordinated   nodes of global value
 Manufacturing  facilitating EoDB, among   beds for global innovations.   in telecom, interesting   will create a market for our   Indian conditions. So, we need   areas like face and voice   such as backdoor spyware   we can come to the   program, with a   chains and enhance its
                                                                                               global footprint.
                                            conclusion that the
                                                                      structure and funding,
 others.   Google first launched its   devices, wireless ear buds,   future semiconductor plants.   to design products that are   In the past, Indian design did   recognition--and all that is   sitting inside electronic   world normal itself does   is required to prepare
 For ensuring that the industry   payment product—Google   neckbands, speakers, pocket   repairable locally. What has so   not work because of the   central to the new economies   hardware. These can result in   not fit in.  for future pandemics.
 Pay in India—before taking it
 serious cyber-attacks of
 remains competitive (by   To conclude, a robust policy   to the world. Global MNCs   projectors, digital and   far happened is that a lot of   sheer pricing pressure from   we build now.  enormous implications, which
 facilitating domestic IP   environment would help the   such as Oppo, OnePlus,   immersive tech, metaverse   manufacturing has come from   Chinese products. Even the   impacts our government
 that can be used for skilling
 creation), even after the PLI &   country to realise the huge   Mondelez, Intel etc have   and education, and so on.   global companies. So, whether   From the point of view of   offices, banks, our defence
 semi-conductors, we need to
 it is Apple or Samsung, or
 other benefits expire, a push   opportunity awaiting India to   opened new R&D centres in   Chinese companies, they are   VALUE ADDED   think locally. India may have to   set-ups, power and space.
 to R&D is most essential. For   emerge as a global hub for   India in recent years. Parag   So, the US$250 billion aim   all designing in China or   MANUFACTURING KEY   wait a while before bleeding   Hardware leaks can be more
 this, the government should   electronics and meet the   Agrawal, CEO of Twitter, now   must embrace these   South Korea or the US, and   TO CUTTING DOWN   edge chips from companies   dangerous than software. We
 explore innovative solutions   targets envisioned in the NPE   joins the growing list of Indian   new mega   therefore they buy   INDIA’S ELECTRONIC   such as Intel, TSMC, and   need to fortify ourselves and
 act fast to develop Indigenous
 for the sector such as a model   2019.  components from those   IMPORTS  Samsung are manufactured   electronics products.
 based on the Government led   countries.  here. For now, the country’s
 domestic manufacturers
 31  ANALYSIS, RESEARCH, THOUGHT LEADERSHIP & ADVOCACY                                ANALYSIS, RESEARCH, THOUGHT LEADERSHIP & ADVOCACY  32
                                                                                           QUARTERLY JOURNAL OF ECONOMICS
 QUARTERLY JOURNAL OF ECONOMICS
 DECEMBER 2021                                                                                       DECEMBER 2021
   27   28   29   30   31   32   33