'Electronics & hardware sector to hit $112-130 bn by 2018'

Indian electronics and hardware industry is expected to reach USD 112-130 billion by 2018 on the back of rising consumer demand, growing disposable income, declining electronics prices and various government initiatives like Digital India, an Assocham-EY study said.
The Indian electronics and hardware market grew 8.6 per cent year-on-year to reach USD 75 billion in 2015, driven by local demand uptick and growing disposable income.
The study said demand for electronic products in India is poised for a significant growth in the next few years, aided by a strong economic outlook.
In addition, adoption of high-end technology devices, transitions such as rollout of 4G/LTE networks and the Internet of Things (IoT) are driving accelerated adoption of electronic products.

"Moreover, the Government of India (GoI) has announced several programmes such as Digital India, Smart Cities, the cloud initiative, solar power, UIDAI projects and the National Knowledge Network initiative, which will boost the domestic consumption of electronics content," it added.
However, India's local production of electronics products is not sufficient to meet the overall demand in the country.

Currently, the electronics demand is largely being met through imports and there is a widening demand-supply gap.
"Hence, the government is focusing on establishing a robust ecosystem to boost local manufacturing," it said.
According to the study, demand of around 50-60 per cent for electronic products and nearly 70-80 per cent for electronic components is met through imports.

"The Make in India initiative, combined with global manufacturers looking to relocate their manufacturing base from China to alternative locations such as India, Vietnam and Indonesia due to mounting labour costs, provides a strong impetus to the Indian electronics and hardware industry," Milan Sheth, Partner and Leader (Technology), EY, said.
The study pointed to challenges in ease of doing business, taxation, end-to-end manufacturing value chain including the component ecosystem, skilled labour and infrastructure bottlenecks.
"Although the government has undertaken steps to promote India as a manufacturing hub in the last two Budgets, certain areas are yet to be addressed," it added.