Love Pulse Posted June 30, 2021 Share Posted June 30, 2021 Electronics and computer software exports are pivotal to any country and even more so now that the pandemic has hit us. To understand the position of India's exports in this segment, ET Digital spoke to Sandeep Narula, Chair of the Electronics and Computer Software Export Promotion Council (ESC). Edited excerpts from the interview: ET Digital (ET): How do electronics and software exports work? Sandeep Narula (SN): The pandemic has affected every aspect of business, and electronics and software are no exception. However, over the past fiscal year, we've seen that it hasn't been seriously affected. Electronic hardware exports declined slightly, while software exports remained stagnant. We haven't seen the growth we were expecting. This year, we were very optimistic at first. But with the second wave of damage reaching new levels, we have a revised estimate of electronics exports. It is now between $10.5 billion and $11 billion. We estimate software exports to be close to $145 million. Ads ET: Why aren't hardware exports doing well? SN: Supply chain issues play a spoiling role in electronics exports. The ingredient industry in India has not matured. Our supply chain requirements are highly dependent on countries. So much about China. Hardware means the physical movement of goods and delays and restrictions in the supply chain affect us. ET: We all know that countries all over the world are highly dependent on China. How does that become a problem for India? What can we do to turn India into a hub when it comes to electronics exports? SN: India has been trying to outperform in the electronics sector for a long time now, as we have in software. Since 2014, the government has started focusing on strengthening India to make it a global hub. Therefore, a stepwise approach must be followed. India came up with PLI (Production Linked Incentive) schemes for various sectors and we came up with a phased industrialization scheme. In this we will see low hanging products that can be developed for manufacturing here and then we can start making semiconductors as well. This, of course, will take some time to take effect. Ads ET: Where did we miss when it comes to electronics, and how has China been ahead of us? SEKEM: This needs some serious reflection. But the fact remains that government policies have not been conducive to the localization of electronic devices. This was followed by the fact that our industry did not invest heavily in research and development. So we gave up on what we could have had. ET: It is not easy to make a semiconductor because it requires a lot of infrastructure. How do we go down this road? CN: There are very few companies that have a semiconductor industry in the world and these companies cater to the entire world. When Covid started in 2020, most of the fab laid off their staff and closed their doors. They believed that this drop in demand due to the pandemic would last for a long time, especially in the auto industry - the world's largest consumer of semiconductors. But many sectors - including consumer electronics and automobiles - have seen new jumps in numbers, leading to serious supply constraints around the world. Now, we have a serious problem on our hands as the fab has been booked for too long and the lead time has been increased to over 52 weeks for critical ingredients. Unfortunately, we don't have a fab in India, and we're totally dependent on Taiwan, Korea, and other places for this. ESC has come up with a study paper on semiconductors - which will be released shortly - where we talk of a solution the government can consider. I'm sure the government is also working on incentivising the semiconductor fab vertical. It is going to be a long-term process but we need to deal with this on an urgent basis. With PLI scheme, India is now net exporter of mobile phones: ESC's Sandeep Narula Long dependent on imports, India's electronics manufacturing may be turning the page. The Government's Production Linked Incentive Scheme (PLI) may be showing early evidence of success as the country has now moved from being a net importer of mobile phones to net exporter, says Sandeep Narula, Chairman, Electronics and Computer Software Export Promotion Council (ESC) . ET: What will be the role of PLI in domestic manufacturing? SN: One example that stands out is that of the mobile industry, where we were the net importers. Electronics imports would have surpassed the oil import bill in our country. This goes on to show how big the potential of electronics is in India. With the PLI coming into shape, we have become a net exporter of mobile phones. We started with assembling and then we can go into phased manufacturing of LCDs and plastic molds, power supplies and some of the components. The whole supply chain process for the mobile phones and electronics industry will take a long time to be put in place, but it will help us in the future. ET: How are we placed in the development of machine learning and artificial intelligence in the software segment? SN: We have been giving a lot of thrust on quantum technologies, especially AI and the internet of things (IoT). In fact, ESC recently did a show on IoT on a virtual platform. We got a very good response not only from Indian exhibitors who have developed the technologies and solutions based on advanced technologies, but also from buyers across the world. I'm seeing that the numbers for the products and solutions in the advanced technologies are going up, and it is a value-add segment for our country. We cannot compete with China or Vietnam at this stage but we are in a very strong position. Link to comment Share on other sites More sharing options...
Recommended Posts