ISA for swifter implementation of electronics policy by govt

Indian Semiconductor Association (ISA), the trade body representing Electronic System Design and Manufacturing (ESDM) sector in the country, has said recently that only swifter implementation of the national electronics mission will propel the Indian electronics sector up 50 per cent.

Speaking at the release of the Frost & Sullivan report on ESDM market in India, commissioned by the Association, its president PVG Menon said the present condition is not conducive for Indian companies to take advantage of the enormous growth generated due to the domestic consumption of electronic products.

“While the nine per cent growth accomplished by the ESDM sector is cause for cheer in comparison with the 5.6 per cent overall GDP growth, we feel the 65 per cent import of electronic products do not provide any significant advantage to the Indian manufacturers,” Menon said.

Unless the government gets down to implementing it urgently, domestic manufacturing ecosystem may not be able to take advantage of the growth we currently witness, he added. According to the ISA-F&S report, which is the first comprehensive ESDM study, Indian ESDM sector is achieving the CAGR of 9.9 per cent. It is expected to grow from $64.6 billion in 2011 to an estimated $94.2 billion in 2015.

The report also indicates that –barring policy intervention from the government- imports will grow from $28 billion in 2011 to $42 billion in 2015.

The report estimates total semiconductor market to grow to $9.7 billion in 2015 from $6.03 billion in 2011. Local demand and sourcing is also growing from $2.9 billion in 2011 to $3.6 billion in 2015, underscoring the heavy reliance on imports.

“Despite this being the sixth edition of the report, we are releasing a comprehensive ESDM report for the first time. Our previous reports only dealt with the Semiconductor industry,” Menon pointed out.

Extending preferential market access from mere Central government level to the PSUs and state governments, addressing the high disability cost in manufacturing etc, will greatly help the sector to grow, according to ISA.

“Without policy implementation, achieving 50 per cent growth in domestic manufacturing (which ISA has set for the industry) will be a tall order,” he further said.