India resets target for consumer electronics industry
India continues to grow in consumer electronics industry
Since 2022, good news in India’s consumer electronics industry has continued to spread.
On September 26, the US Apple announced that the company has started producing the iPhone 14 series in India, less than three weeks after the launch of the iPhone 14 series. Compared with the past, this is a big improvement. Indian media believes that Apple’s decision to manufacture the iPhone 14 series models in India means its recognition of India’s prospects and manufacturing capabilities as the world’s second largest smartphone market after China.
On October 1, Indian Prime Minister Narendra Modi announced that India officially launched 5G communication commercial services, which marked India’s official entry into the 5G era. Relevant Indian agencies said that India’s 5G services will first cover 13 major cities including Mumbai, Delhi, Bangalore, Hyderabad, Lucknow, Pune, Chennai, Ahmedabad and Chandigarh. The rollout of 5G services will boost the manufacturing and adoption of smartphones in India.
Data shows that as of June 2022, the number of 5G smartphones in the Indian market is about 50 million, and it is expected that by the end of this year, the market will add 20 million to 30 million 5G smartphones. Ericsson’s latest estimates show that by 2023, more than 100 million smartphone users in India will have 5G-enabled phones.
India officially joined the global chip manufacturing competition. Foxconn, Indian company Vadatta and the government of the Indian state of Gujarat have formally signed an agreement to jointly invest $19.5 billion to build a 1,000-acre chip manufacturing plant that will provide 100,000 jobs. Prime Minister Narendra Modi sees the agreement as an important step in accelerating India’s semiconductor manufacturing ambitions.
These good news in the Indian consumer electronics industry are the initial results of the Indian government’s policy to advance the consumer electronics industry. There have been two notable shifts in Indian policy in the consumer electronics industry in recent years. First, the goal of India’s consumer electronics industry has officially shifted from “import substitution” to “Made in India”.
Pankaj Mohindroo, chairman of the Indian Electronics Industry Association (ICEA), pointed out in a related report that India’s strategy in the consumer electronics industry has changed, no longer import substitution, but turning to Indian manufacturing and going global.
The size target of India’s consumer electronics market has doubled
The Indian electronics manufacturing industry was worth $37.1 billion in FY 2015-2016 and about $67.3 billion in FY 2020-21. If India continues its path of import substitution, India’s domestic electronics market is expected to reach $150 billion to $180 billion in the next four to five years. But if it is converted to Made in India, the size of India’s consumer electronics industry will reach $300 billion. Among them, 120 billion to 140 billion US dollars of electronic consumer products will be used for export.
India will thus become one of the main contenders for alternative solutions for electronic companies in the world, according to documents from the Indian Electronics Industries Association (ICEA). The consumer electronics industry has the potential to become one of India’s largest export industries in the next 3 to 5 years, making a significant contribution to the Indian economy.
India has introduced relevant policies in the field of consumer electronics
India has not only put forward a development vision in the field of consumer electronics, but also introduced relevant supporting policies.
Rajeev Chandrasekhar, Federal Minister of Electronics and IT, pointed out that the Indian government is currently focusing on expanding the electronics manufacturing space in India, and the Manufacturing Promotion Program (PLI) implemented by the Indian government will systematically upgrade the manufacturing industry.
The Indian government plans to implement a 2 trillion rupee manufacturing promotion plan, including a $10 billion chip promotion plan related to consumer electronics manufacturing, a promotion plan related to the smartphone field, and $4.6 billion related to the new energy vehicle field. stimulus plan, etc.
Driven by the policy of raising import tariffs and promoting the establishment of consumer electronics manufacturing in India, Chinese smartphone manufacturers, including Xiaomi, OPPO, VIVO, etc., have set up factories in India. South Korea’s Samsung and others are also increasing their investment in India. American technology companies, including Amazon, Microsoft, and Facebook, have also set up factories or increased investment in India.
Data shows that in the Indian mobile phone market, Indian local manufacturing companies are on the rise. To become a powerhouse in consumer electronics manufacturing is one of the main economic goals of the Modi government in India. Modi previously pointed out that in terms of semiconductor manufacturing, India has no choice but to rely solely on foreign imports. India must reduce imports and increase its self-manufacturing capabilities.
Made in India has infinite possibilities and India must work together to build a strong manufacturing base. Pankaj Mohindroo, chairman of the Indian Electronics Industry Association (ICEA), previously pointed out that it is very important to actively promote the development of consumer electronics to build India into a $5 trillion economy and a $1 trillion exporter of goods.
The Indian government’s efforts have yielded partial results. In September, India’s smartphone exports hit $1 billion for the first time. According to research, shipments of “Made in India” smartphones increased by 16% year-on-year from April to June 2022 to more than 44 million units.