‘Centre mulling major scheme to push electronics component manufacture’
IT Secretary Krishnan says the plan is to increase local value addition from 18-20% to 38-40%
Building on the initial successes India achieved in electronics manufacturing, there is an ambitious plan to increase local value addition from the current 18-20 per cent to 38-40 per cent. The Centre is working on identifying the top five electronic components for which incentives can be oered to attract investments and build a strong electronic components manufacturing base in the country, said S Krishnan, Secretary, Ministry of Electronics and Information Technology (MeitY).
“There will be a large components promotion scheme by the Centre in order to bring in manufacturing. The objective is to identify five top items including PCBs (printed circuit boards) and encourage much more of such manufacturing in the country. It is important from a resilient and continued competitiveness perspective to get it done,” he said, while delivering the 10th G Ramachandran Endowment Lecture,
organised by the Madras School of Economics and the South India Chamber of Commerce and Industry.
For this electronics components manufacturing promotion, incentives could be provided or “we can learn from other countries including Europe as not all barriers have to be physical”, he said.
Krishnan highlighted India’s success in attracting assembly and packaging units for mobile phones, achieving 18-20 per cent value addition. He suggested doubling this to 38-40 per cent to improve resilience. While China achieves 40-45 per cent value addition by sourcing inputs globally, Krishnan emphasised that India should focus on areas where it can make a dierence rather than trying to cover the entire value chain.
PVT SECTOR INVOLVEMENT
To participate in global value chains, India needs to build capacity and foster industrial champions. Krishnan noted the importance of private sector involvement, highlighting the eorts of major groups such as the Tatas and Murugappas in foraying into electronics and semiconductors. “Many such groups need to get into electronics manufacturing in the days to come,” he added.
Earlier, discussing the impact of the digital economy and the outlook, he said the share of the digital economy in the overall economy, is likely to be significantly larger, but more importantly, it is likely to contribute to the growth of the other elements of the economy as well. Also, the digital economy carries the potential to deliver inclusive growth and will allow for a range of participants to come in, he stated.