The Digital India Will Soon Get The Digital Rupee

Skyrocketing Electronics Production in India.

~Preet

The push for the Idea of Atmanirbhar Bharat, which was pitched by Prime Minister Modi seems to be going in the right direction as the manufacturing and production in India is constantly growing. The vision document, released by the Ministry of Electronics and IT (MeitY) in association with India Cellular and Electronics Association (ICEA) reveals that India can make $300 billion by the end of 2026. Although it is less than the target of $400 billion by 2025, set by the National Policy on Electronics (NPE) 2019, it is still a great achievement since this has been a tough phase for the nation given the unprecedented challenges brought by the pandemic.

The reduced target still seeks to gain a 400% increase over the current level. The electronic manufacturing which was at $37.1 billion in 2015-2016 has grown to $67.3 billion in 2020-2021 even though there were many disruptions due to restrictions to curb the surging COVID cases. 

The policies of the government have no doubt aided the ecosystem for the production of electronics, but there still remains loads of issues which somewhat fractures the production abilities of Indian industries, across qualitative (non-tariff, infrastructure related) and quantitative (tariff, free trade agreements etc.) aspects. These issues must be addressed to make Indian production competitive on a global level. 

The mobile manufacturing, which is currently at $30 billion is expected to cross $100 billion and constitute nearly 40% of this ambitious growth. Amongst the key products that are expected to lead India’s growth in electronics manufacturing include Mobile Phones, IT Hardware (laptops, tablets), Consumer electronics (TV and audio), Industrial electronics, Auto electronics, Electronic components, LED Lighting, Strategic electronics, PCBA (Printed Circuit Board Assembly), Wearables and hearables, and Telecom equipment.

According to the analysis, India's need for electronic items might reach $180 billion by 2025-26, and if India meets its $300 billion production objective for electronics, the domestic market demand could be fulfilled entirely by such manufacturing. "This would involve the shipment of $120 billion worth of electrical devices to the worldwide market," it stated.

IT Minister Ashwini Vaishnaw stressed during his speech at the document's publication that the Ministry of Telecom will not intervene in topics relating to mobile phone manufacture, despite worries from the sector that such a move would result in stringent restrictions.

Concerns about large-scale factories that can employ 40,000 to a lakh people were addressed by the Minister, who said that this would necessitate changes in labour regulations, and that he had discussed the issue with the Labour Minister, who believes that this is a highly feasible option that would require no major changes. He went on to say that industry had pointed out that other nations allow 'housing on campus,' which India does not, and that based on his conversations with the Labour Minister and State government officials, both believe it is achievable with a few tweaks in the legislation. 

while requesting industry to come up with one specific location where this could be tested, he said that, “So, the suggestion here is that we take a particular case and see whether it can be done with State governments tweaking of regulations, or it can be done with Central government’s advisory to the State government and then subsequent tweaking of regulations by the State government.”