“28 million new jobs can be created in the electronics manufacturing sector in the country,says Dr Ajay Kumar, Joint Secretary, Department of Electronics & Information Technology, DeitY, Ministry of Communications & IT, Government of India. In conversation with Express Computer Team
India produces less than 5% of its electronics needs. What steps is the government taking to ensure that the nation? electronics requirements can be met through domestic manufacturing?
The demand for electronics goods is very high today. India is one of the few countries in the world where the demand for electronics products is rising at a very high pace. A number of steps have been taken to encourage electronics manufacturing. Today 100 percent FDI is permitted under automatic route in Semiconductor Fabrication Plants. Government will also provide assistance for setting up of world-class infrastructure for the semiconductor fabs and its ecosystem units. The government has identified many electronics manufacturing hubs, where the companies will be eligible for incentives, including subsidy for setting up such facilities. Electronics manufacturing has a significant strategic implications. In defence, 49% FDI has been allowed by the government. But the thing is that about 60% of all defence goods is electronics.
Why is India lagging behind in the setting up of Semiconductor Wafer Fabrication Manufacturing Facilities?
The government has already approved the setting up of two Semiconductor Wafer Fabrication Manufacturing Facilities (FAB) in the country. Two business consortia are involved in setting these up. Once these FABs become operational they can create direct job opportunities for more than 20000 people. The number of indirect jobs generated could be much more, as the two FABs could lead to development of an entire ecosystem for electronics manufacturing. We have been facing the difficulty of having FAB units in India because the cost of a FAB is quite high. It can cost up to $5 billion. The technology is also very advanced. Very few companies in the world have the expertise to set up a FAB.
The consumption of mobile phones, set top boxes and other electronics products in the country is skyrocketing. Why are the electronics manufacturers refraining from manufacturing in India?
There are many factors. One of them could be the high cost of power and finance. The poor state of supply chain can also be a reason. All these problems are being looked at by the government. The demand for electronics products is expected to reach $400 billion by year 2020. The government is working with the aim of correcting the situation so that we don’t have to import our electronics needs from outside.
It is also being said that electronics manufacturing can lead to generation of millions of jobs in India. What kind of job creation can be expect in this sector?
Our estimates show that an electronics manufacturing industry of $400 billion can provide direct jobs to 28 million people in India. Unless we revive manufacturing in the country, the so called demographic dividend, of young Indians, will never be realised. Thatis why the government is now making an all out effort to promote electronics manufacturing.
Recently you took over as the Director General of National Informatics Centre. What is your vision for the organisation?
NIC is india? premier eGovernance body. The organisation has been responsible for the creation and security of many of the important websites with the central government, state governments, various departments and PSUs. Most of the officials in the country use email system developed by NIC. The government has come up with the Digital India Initiative for taking eGovernance and the electronics and IT sectors to the next level of development. NIC is working in a very focussed way for ensuring the success of the Digital India initiative. My vision for the organisation would be to ensure that NIC is able to contribute its mite in the speedy and efficient implementation of the eGovernance projects in the country.
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