Indian electronics hardware sector to be $112-$139 bn by 2018

Indian electronics and hardware industry is expected to grow at a compounded rate of 13-16 per cent to reach USD 112-130 billion by 2018 but imports will continue to dominate the market, says a study.
"The Indian electronics and hardware industry is expected to grow at a CAGR of 13 per cent -16 per cent during 2013-18 to reach USD 112- 130 billion by 2018. However, given the local manufacturing state, the dependence on imports is likely to remain similar," the study by Assocham and consultancy firm EY released today said.
"The Indian electronics and hardware market is currently being driven by mobile phones and consumer electronics, which together contributed nearly 45 per cent of the overall electronics products revenues in 2015," it said.

Around 50-60 per cent of the demand for electronic products and the demand for nearly 70-80 per cent of the electronic components market is fulfilled through imports.
"Growing reliance on imports for electronic components and rapidly increasing demand for electronic products is making it indispensable to grow and strengthen India's electronics manufacturing capabilities," the study said.
It acknowledged government effort to boost local manufacturing of electronic hardware due to which multiple foreign manufacturers are setting shops in the country. As per the study, the electronics exports are also expected to grow with global companies looking to invest in India for manufacturing set-ups.

As per the study, limited intellectual property right creation, absence of semiconductor plant, low cost imports from China are some of the challenges that need to be resolved.
"Components sourcing and fabrication is an important activity that determines the strength of the country's native capabilities in manufacturing because components are the building blocks of electronic devices. India has a limited component supplier base with a majority of high value and critical components being imported," the study said.
Components that are pre-dominantly imported include integrated circuits, printed circuit boards (PCBs) and other active components. These are imported from markets such as China, Japan, Indonesia, Malaysia and Taiwan, it said.