India’s electronics and IT secretary, S Krishnan, has stressed the importance of increasing value addition in electronics manufacturing in the country. Currently at 18%-20%, Krishnan believes it needs to double to 40% in order for India to truly assert itself in the global market. To achieve this, he suggests that India should shift its supply chain from China, tapping into opportunities to move up the value chain and gain a larger market share.
Krishnan emphasizes that India should focus on value addition only where it is feasible, ensuring that the country’s efforts in the electronics sector will yield positive results. He highlights the significance of capacity building, training, and the active participation of larger industrial groups to drive growth in the industry.
In terms of regional strategies, Krishnan advocates for the southern states of India to move away from labor-intensive electronics manufacturing services (EMS), such as assembly and packaging, and instead prioritize higher-value component manufacturing. This strategic shift will allow the region to capture more value and further contribute to the overall growth of the electronics manufacturing sector.
Krishnan also emphasizes the importance of shifting the electronics supply chain as a means to build a resilient supply chain for India. By reducing dependence on a single country and diversifying supply sources, India can mitigate potential geopolitical risks and align with its strategic requirements. He specifically refers to the potential conflict in the Taiwan Strait as a motivating factor behind the need for such diversification.
The Indian government has set ambitious targets, aiming to secure a 10% share in the $4.3 trillion global electronics market within the next five years. This is a significant increase compared to the current share of around 3%. Achieving this target will require concerted efforts, including policy support, infrastructure development, and collaborations between industry stakeholders.
Overall, India’s focus on increasing value addition and shifting the electronics supply chain demonstrates its determination to solidify its position in the global electronics market. By capitalizing on opportunities and addressing challenges, India can establish itself as a leading player in the electronics manufacturing industry.
