From Make in India to global dominance

To become a global manufacturing hub, India needs to focus on new-generation electronics, deepen R&D, ally with Taiwan, and create self-resilient products

The last few years have seen the government take major steps to encourage the manufacturing of electronics in India. The production-linked incentive scheme, a string of reforms in the last decade, and the move away from China towards a safe India have provided the catalyst needed for electronics growth in the country. The next step is to build our products and get into product ownership to usher in a new era of Make in India products that are 100% repairable and upgradable, and support the vision of a robust growth nation catering and supporting a circular economy to the global market as well.

According to the Ministry of Electronics and Information Technology, electronics manufacturing in India will balloon to USD 300 billion in 2026 from USD 68 billion at present. We must rapidly transform India into a manufacturing hub for new-generation electronics products with minimal dependence on foreign components. To see real change, we need to deepen research and development. Taiwan helped create China as a product nation. There is a need to ally with Taiwan to learn from them. What makes us truly unique is that not only do we know how to design hardware, but we also know how to integrate software into hardware.

Let me give examples of some products that will help scale up our product self-resilience and kick-start job creation for high-end value jobs and blue-collar workers.

New products, newer markets

There is a growing pressure to transition towards sustainability. Smart meters that use digital technology, enable a two-way flow of electricity and information. Consumers and suppliers can thus be empowered to make informed choices on smart energy use. The global smart meters market is expected to grow from USD 19.6 billion in 2021 to USD 30.2 billion by 2026 at a CAGR of 9.0%, and we can seize this opportunity.

Next, the global market for laptops and tablets will be USD 220 billion per year over the next three years, while in India, the market size is pegged at USD 7 billion. Nearly 87% of laptops and tablets come from China. We need to change this by increasing localisation and creating upgradeable and repairable products.

Third, our startups have a huge opportunity in the drone market, especially if they start making the components too. So far, DJI China has 90% of the global drone market, which is poised to become a USD 54 billion market by 2025. With the government enforcing a ban on the import of drones, there’s a huge market for not just the high-end segment like for defence and surveys, but also in the nano drone and micro drone segments used for entertainment, filming and so on.

Similarly, the Indian medical devices industry is growing at 28% each year to reach USD 50 billion by 2030. The way IIT Kanpur Ventilator Consortium assisted Noccarc Robotics, a young startup, in building affordable, high-quality ventilators, at the peak of the pandemic, is a case study of possibilities. The reason we are placed beautifully in Medtech is that most of the devices in use have outdated electronics. We need to make connected devices with predictive maintenance and usher in an era of more modern products in the health sector. We can also integrate Artificial Intelligence and Machine Learning into our products.

Meeting consumer needs

In the consumer market, too, we can make an impact. India’s wearables market saw record double-digit growth in the first quarter of 2022, with shipments crossing 13.9 million units. The earwear category accounts for 71.3% of the overall wearables category. Quality manufacturers like Boat and Noise need to look at components too in this segment, and many more such startups can cater to the local and export markets.

Similarly, in phones, we need to propel growth and see more brands, like Lava and Micromax, in the mid and high segments that are completely Made in India. In space, India’s share in the USD 360-billion global space economy is 2%. A growing impact in the space sector is needed to address national imperatives and for deepening research.

We need to identify 100 to 500 products for the next 5 to 10 years and go after designing and manufacturing these in India. Our opportunity to replace China as

the only product nation is there due to geopolitical reasons. There is more trust in India as a supplier than in China. We must seize this opportunity.

By Ajai Chowdhry

The author is the Founder of HCL and Chairman of Epic Foundation

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