Government sets up task force to revive domestic mobile manufacturing

Aiming to take the Make in India programme a step further, the Department of Electronics and Information Technology (DeitY) has formed a Fast Track Task Force to re-establish growth in the country's mobile handset and component manufacturing eco-system.

"The task force will be meeting the Department of Electronics and Information Technology secretary (R.S.Sharma) in the first week of January," Pankaj Mohindroo, national president, Indian Cellular Association, told IANS. Sharma is also the chairman of the task force.

"(One of the tasks is) To promote large-scale manufacturing/assembling activity to achieve production of 500 million units by 2019. This can create additional employment opportunities for 1.5 million approximately," a note issued by the department said.

It also laid thrust on increasing exports from the estimated 30 million units in 2014 to 120 million units by 2019.

India's position in mobile phone exports has fallen from seventh in 2009 to 14th in 2013. The value of exports was $3.40 billion in 2009 and fell to $2.28 billion in 2013.

Industry stakeholders say at this rate, handset exports will crash to zero in 2015.

"Through this task force we will be reaching out to global handset manufacturers, brands, ODMs (original design manufacturers) and EMS (electronic manufacturing services) to request them to come and set up shop in India. The government has to provide a level playing fields to those players," Mohindroo said.

He said sub-committees will be formed under this group to carry out various tasks, adding that promoting manufacturing will also have a positive impact on the prices of mobile handsets and they will come down.

In India, Samsung and Micromax currently engage in the large-scale manufacturing of handsets. Nokia operated the world's largest manufacturing facility at Sriperumbudur in Tamil Nadu which was shut down in November on tax and labour issues.

All the other players import their products mostly from China, followed by Vietnam.

The estimated domestic mobile handset market size is Rs.75,000 crore ($12 billion) in 2014, of which handsets worth Rs.58,550 crore are imported.

For 2015, the estimated market size is Rs.1 lakh crore, with imports accounting for Rs.75,500 crore.

The task force has to create a roadmap to align technology, demand, standards and regulations for enhancing the competitiveness of domestic manufacturing across the supply chain for manufacturing mobile phone.

"(One of the tasks is) To promote research and development for mobile phone products and services for meeting the infrastructure needs of domestic and global market," the government note said.

The task force has members like Josh Foulger, president and director, India Operations Programme and president, Nokia Special Economic Zone, Hari Om Hari; Lava co-founder Kenichiro Hibi; managing director, Sony India, Sandeep Bhargava; director, government relations, Microsoft Devices India, Soon H Kwon; and co-founder, Micromax Informatics, Vikas Jain, among others as its members.

The other members are S.P. Kochar, chief executive officer, Telecom Sector Skill Council; Sudhir Hasija, co-founder Karbonn Mobile; Dilip Modi, chairman, Spice Corporation; Asha Nangia, director, DeitY; S.K. Marwah, director, DeitY and Gautam Ray, ex-joint secretary, TRU.

(Aparajita Gupta can be contacted at aparajita.g@ians.in)