ESDM sector asks for rapid implementation of the policy

Speaking in the session on ESDM at BangaloreIT.biz on Wednesday, industry representatives asked the government to recognise computer hardware as a separate sector from IT and provide investments which would save the revenue drain through imports and loss of competitive advantage.

“Electronic consumption in this country is growing about 23 per cent CAGR, while figures for 2012 is slated to be nearly 9.86 billion USD. Out of this we would be spending 4.71 billion dollar for import of components, which is nearly 50 per cent of the consumption,” pointed out Chairman of Indian Semiconductor Association (ISA) Dr Pradip Dutta.

Quoting a recent study conducted by ISA, which divides electronic and hardware manufacturing amongst different sectors like telecom, consumer, industry automation, automotive, Printed Circuit Boards (PCBs) etc, Dutta said the gulf between domestic consumption and increasing import do not allow the country to enjoy the true benefits of growth.

In verticals like mobile and telecom equipments, where, according to a recent TRAI report, India consumed about Rs 43,000 crore worth of products and services, the country’s import bill is on the increase, while the domestic industry has completely failed to gain from the growth, said CEO and MD of Tejas Networks Sanjay Naik, speaking on the situation on the Telecom sector. According to Managing Director of Circuit System India Ltd (CSIL) Paresh Vasani, the country is missing the bus in terms of PCB manufacturing.

“The PCB industry here is just 0.2 per cent, despite the quantum jump in consumption. We import most of the motherboards from China and other far eastern countries, while no one from the top 200 companies have shown interest to set up business in India given the almost total absence of infrastructure and lack of quality standards,” Vasani said.

Despite the gloomy prediction, industry representatives  agreed that the government’s electronic policy is the move in the right direction.

“We understand that the electronic manufacturing industry needs a good growth environment,” said Joint Secretary at Department of IT, Ministry of IT and Communications, Dr Ajay Kumar, reiterating the policy measures the government had recently announced in the electronic policy.

“We are acting with the sense of urgency and hopefully, will be able to offer the investment and growth conditions for manufacturing in the next two years,” Kumar said.