India to consume $120 bn worth of IT hardware in next decade: MAIT

Over the next decade, India is expected to consume around $120 bn of IT hardware. This market demand offers India an opportunity to set up a global scale through PLI for IT hardware. The manufacturers body, MAIT believes that it is the right time for India to boldly position itself on the global map as the preferred destination for ICT hardware manufacturing.

MAIT in an official statement applauded the government’s initiative, and highlighted that the global PC and Server market is around $227 bn. Nitin Kunkolienker, President MAIT, said this scheme will expectantly set the dormant sector of ICT hardware manufacturing into a revival mode. “Towards this, we will continue working with the government and transpire on an expanded scheme that will set India on the road to garner at least 20% of the global market to be serviced out of India which will translate to an opportunity of almost $45 bn of production annually,” Kunkolienker said.

“Electronics is a sector that requires global scale to be competitive. And now is an opportunity to pursue an aggressive export-led manufacturing strategy of PLI in the national strategic sector of IT hardware. India suffers disabilities on account of non-availability of a local component ecosystem, lack of local supply chain, cost of power supply, connectivity to ports and airports, the lack of global transhipment hubs for sea and air out of our country and others. These issues are amplified for the electronics industry due to its inherent nature of rapid evolution in technology and products.”

The government, in a major boost to the electronics manufacturing, has approved a Rs 7,325 crore production linked incentive (PLI) scheme for laptops, tablets, all-in-one personal computers, and servers.

IT Minister Ravi Shankar Prasad said the government has chosen several sunrise sectors where PLI schemes have been started. “The PLI is a very simple term. Come to India, invest, set up your factory, manufacture, export and earn incentives. PLI is linked to your manufacturing capability and delivery on the ground,” he explained.

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The scheme proposes to boost domestic manufacturing and attract large investments in the value chain of IT hardware. It shall extend an incentive of 4% to 2% and 1% on net incremental sales of goods manufactured in India and covered under the target segment, to eligible companies, for a period of four years. The scheme is likely to benefit major global players and 10 domestic champions in the field of IT hardware manufacturing including laptops, tablets, all-in-one PCs, and servers. This is an important segment to promote manufacturing under Atmanirbhar Bharat as there is a huge import reliance for these items at present.