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India's Electronics Odyssey: From Biggest Buyer to Global Supplier?
- India's electronic manufacturing sector is now working towards self-reliance, with hopes of becoming a significant exporter, and has recent strides in manufacturing, robust policy support, and growing foreign investment.
- India's electronics imports hit $76 billion in 2023, making it India's second-largest import category after crude oil.
- Between 2017 and 2022, India’s electronics production nearly doubled, reaching $101 billion, driven primarily by mobile phone manufacturing, which now accounts for 43% of the country’s electronics output.
- As of FY24, India’s electronics exports grew by 23.6% to $29.12 billion, signifying the sector's potential to contribute substantially to India’s export portfolio.
- The Indian government has rolled out a series of strategic policies to bolster local manufacturing, reduce import dependency, and turn India into an export hub.
- India’s large pool of young, skilled workers is a significant asset. Labor costs in India are relatively lower than in many competing manufacturing hubs like China, making it a cost-effective choice for electronics production.
- Several global giants have embraced India’s manufacturing ecosystem including Apple, Samsung, and Micron.
- Despite advancements, value addition remains around 15–20%. India’s long-term goal is to achieve 35–40% value addition by FY30, which requires strengthening local supply chains and investing in R&D for components manufacturing.
- To reduce this dependency, India will need advanced manufacturing facilities and substantial R&D investment.
- India’s transition to a net electronics exporter is a long-term goal but appears achievable with sustained policy support, large-scale investments, and a commitment to strengthening local manufacturing.
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