July 19, 2024: NITI Aayog outlined India’s ambitious plan to catapult its electronics manufacturing sector into a $500 billion powerhouse by 2030, a move anticipated to generate up to 6 million jobs nationwide.
Titled ‘Electronics: Powering India’s Participation in Global Value Chains’, the report underscored the vast potential of the global electronics market, valued at a staggering $4.3 trillion, which is currently dominated by major players including China, Taiwan, the US, and South Korea.
Despite India’s significant 4 percent share in global demand, its current annual electronics exports amount to just $25 billion, a fraction of the global market. The report emphasized the urgent need for India to localize high-tech components, bolster design capabilities through increased R&D investments, and cultivate strategic alliances with global technology leaders.
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As of the fiscal year 2023, India’s electronics production stood at $101 billion, comprising $86 billion in finished goods and $15 billion in components manufacturing. During the same period, the country’s electronics exports reflected a growing influence in the global market.
The NITI Aayog report highlighted that the electronics sector contributes 15 to 18 percent to domestic value addition and has already created approximately 1.3 million jobs. However, under a Business As Usual scenario, projections suggest that India’s electronics manufacturing could surge to $278 billion by fiscal year 2030, with exports expected to reach $111 billion and employment opportunities expanding to around 3.4 million.
The NITI Aayog stressed that achieving India’s ambitious $500 billion target would require a conducive business environment and robust policy support, including fiscal incentives and non-fiscal interventions. The report proposed a comprehensive strategy encompassing fiscal, financial, regulatory, and infrastructural reforms to bolster the sector’s growth trajectory.
Key recommendations include promoting local manufacturing of components and capital goods, incentivizing R&D and design capabilities, rationalizing tariffs, investing in skilling initiatives, facilitating technology transfers, and developing critical infrastructure to foster a resilient electronics manufacturing ecosystem in India.
In conclusion, the NITI Aayog affirmed that realizing India’s vision as a global economic powerhouse hinges significantly on advancing its technology-driven sectors, with the $500 billion electronics manufacturing target poised as a pivotal milestone in this trajectory.
