Tue, May 23, 2017 | updated 02:38 PM IST

Indian electronics products to touch USD 75 bn by 2017, says ASSOCHAM-EY study

Updated: Sep 19, 2016 13:35 IST      
Indian electronics products to touch USD 75 bn by 2017, says ASSOCHAM-EY study

New Delhi [India], Sep 19 (ANI): The Indian electronic products industry in India is expected to grow at a CAGR of 10.1 percent to reach USD 75 billion by 2017 from USD 61.8 billion in 2015 with increasing penetration across consumer products especially in semi-urban and rural markets, along with government push for infrastructure development, locomotive and energy, there exists a significant opportunity for rapid expansion of this industry, adds the ASSOCHAM-EY joint study.

The electronic components industry in India was valued at USD13.5 billion in 2015, growing from USD10.8 billion in 2013 at a CAGR of 11 percent. The market is dominated by electromechanical components (such as PCB and connectors) which form 30 percent of the total demand, followed by passive components (such as resistors and capacitors) at 27 percent, according to an ASSOCHAM-EY study titled 'Turning the Make in India dream into a reality for electronics and hardware industry'.

India's attractiveness for manufacturers is growing due to availability of low-cost labor. Rising manufacturing costs in China and Taiwan are compelling manufacturers to shift their manufacturing base to alternate markets. In 2014, the average manufacturing labor cost per hour in India was USD 0.92 as compared to USD 3.52 of China, noted the study.

The Indian manufacturing ecosystem for electronics and hardware industry is still at a nascent stage and faces various demand side as well as supply side challenges are limited scale of operations and local component demand due to the nascent product manufacturing in India. Component demand in India is muted due to very limited value addition as primarily last-mile assembly takes place. Norms such as safety regulations for automotive, medical and industrial sectors have driven the uptake of electronic content globally.

However, manufacturers in India do not add high electronic content in the products due to limited industry-specific standards. The current market is dominated by secondary sales and primary sales are limited due to reduced disposable income in semi-urban and rural markets. The market penetration for most of the consumer appliances and electronics is currently lagging behind global average by up to 60 percent in certain categories and there lies huge untapped potential in rural markets (approximately 69 percent of India's households).

Although global markets are witnessing rapid consumer uptake as electronic content increases across verticals (e.g., automotive with applications around safety, connectivity, infotainment, consumer electronics, smart homes, etc.); India has a slower adoption as consumers remain highly sensitive to even a marginal increase in product prices.

Due to nascent stage of electronics manufacturing in India, scale of operations is low, resulting in reduced cost competitiveness. Traditional electronics manufacturing destinations such as China, Taiwan and South Korea have built significant capacities across manufacturing value chain (SKD assembly, CKD assembly, Semiconductor Assembly and Testing Services). In addition, emerging (Malaysia, Vietnam) destinations have also built capacities. Although labor cost is low in India, labor productivity is lower than traditional destinations.

The basic infrastructure for any industry comprises good roads, power, water, telecommunications, ports and logistics. In India, availability of these facilities is not up to the mark, even in established industrial estates. While the Government has notified Greenfield Electronic Manufacturing Clusters, they still remain un-operational due to infrastructure issues.

The lack of proper roads and sales infrastructure results in distribution challenges for companies catering to markets in small semi-urban cities, rural areas and remote villages. Additionally, from both import and export perspective, there is port congestion due to unavailability of containers and long documentation process.

Availability of relevant manpower is crucial to the development of any industry. Since the electronics manufacturing industry has high dependence on skilled manpower, especially for highly specialized activities such as electronics system design, IC design and manufacturing etc., the availability of talent with relevant skill sets assumes considerable importance.

Both SKD and CKD are labor intensive and require delicate handling and process adherence during the manufacturing process. With changing technology, the labor needs to be constantly trained. However, the current labor scenario in India poses certain challenges.

India's taxation system is complex, especially where indirect taxes are concerned. Currently, the base direct tax incidence in India stands at around 30 percent, whereas the corresponding tariff in other Asian countries is between 16 percent and 25 percent.

Although, the Government has proposed the implementation of Goods and Services Tax (GST) for a state-of the-art indirect tax system, there are concerns that the industry faces in terms of the clarity on the revenue-neutral rate, non-creditable tax on inter-state movement of goods, status of existing state incentives granted and transition from existing taxation system to GST regime.

Procedural and regulatory clearances are time consuming and complex. According to industry sources, it takes up to a year to set up a manufacturing plant in the country and a new production line could take up to six months to become fully operational.

Additionally, the refund processes and clearances to avail benefits under tax are highly cumbersome and time-consuming. Procedure to claim concessional duty on many raw materials/ parts/components used in manufacturing of electronics products has been recently simplified in the Union Budget 2016-17 by introducing the concept of self-assessment. (ANI)

Tax incidence on entertainment services under GST lowered

Updated: May 23, 2017 12:57 IST     

New Delhi [India], May 23 (ANI): Taxes on entertainments and amusements were subsidised under the Goods and Services Tax (GST), except to the extent of taxes on entertainments and amusements levied by a Panchayat or a Municipality.

Full Story >>

Acko General Insurance raises USD 30 million

Updated: May 23, 2017 12:00 IST     

New Delhi [India], May 23 (ANI): Acko General Insurance on Tuesday received it's in principle regulatory clearance to launch a General Insurance business in India. In a regulated business, Acko raised USD 30 million.

Full Story >>

Gandhinagar (Gujarat), May 23 (ANI): With the changing global landscape for agriculture and food security, Union Finance Minister Arun Jaitley said that India and Africa can emerge as key partners in these areas.

Full Story >>

New Delhi [India], May 23 (ANI): Digital payment aggregator Paytm on Tuesday unveiled the Paytm Payments Bank, a first-of-its-kind bank that will offer cashbacks on deposits. Customers will also be entitled to zero charges on all online transactions and no minimum balance requirement.

Full Story >>

San Diego (California) [United States], May 23 (ANI): Kyocera International, Inc. has announced that it has received Class Y certification for its semiconductor assembly operations here.

Full Story >>

Jaguar introduces 2.0l diesel derivative of Jaguar XE

Updated: May 23, 2017 06:13 IST     

Mumbai (Maharashtra) [India], May 23 (ANI): Jaguar Land Rover India yesterday announced the start of sales for the 2.0l diesel derivative of MY17 Jaguar XE in India at a starting price of Rs. 38.25 lakh, ex-showroom, Delhi.

Full Story >>

SRF limited announces Q4 and FY17 financial results

Updated: May 22, 2017 18:51 IST     

New Delhi [India], May 22 (ANI-NewsVoir): SRF Limited, a chemical based multi-business entity engaged in the manufacturing of industrial and specialty intermediates today announced its consolidated financial results for the fourth quarter and full year ended March 31, 2017 under Indian Accounting Standards (IndAS). The company's audited results were approved by the Board of Directors in a meeting held today in Gurgaon, Haryana.

Full Story >>

CBDT signs two more Unilateral APA's with Indian taxpayers

Updated: May 22, 2017 18:45 IST     

New Delhi [India], May 22 (ANI): The Central Board of Direct Taxes (CBDT) on Monday announced entering into two Unilateral Advance Pricing Agreements (APA) with Indian taxpayers on May 4 and 11 respectively, out of which one agreement holds a rollback provision.

Full Story >>

Bangalore [India], May 22 (ANI-Businesswire India): Relocating household goods from one place/city to another can be really one of the most challenging, hectic and stressful events of life. Whether it is a local shift within the city of Bangalore or relocating home from this city to another city of India, it would be a complicated and time-consuming process for an individual to do it all alone. There are lots of hassles, tedious tasks and unpleasant issues involved with the process of relocation which can pester an individual badly. On the other hands, hiring services of one of the credible and competent packers and movers in Bangalore would be a great decision with respect to simplify the relocating process and turn the circumstance into the easygoing and smooth affair.

Full Story >>

New Delhi [India], May 22 (ANI): Online recruitment marketplace AasaanJobs on Monday announced the roll out of its 'Interview scheduling' feature for employers and candidates, which will allow employers to specify and pick different time slots for scheduling interviews with job aspirants.

Full Story >>

New Delhi [India], May 22 (ANI): Schneider Electric the global specialist in energy management and automation on Monday announced appointment of Venkatraman Swaminathan as the Vice-President, IT Division - India Zone.

Full Story >>

New Delhi [India], May 22 (ANI-NewsVoir): Pearl Academy, India's leading private institution in design, fashion, creative businesses and media, concluded its ten-day long campaign - #MumbaiByDesign which celebrated the quintessential Mumbai through a series of initiatives across the city.

Full Story >>

foodpanda raises USD 431.45 million from Naspers

Updated: May 22, 2017 15:30 IST     

New Delhi [India], May 22 (ANI): Online marketplace for food delivery foodpanda on Monday announced receiving of investment worth USD 431.45 million from global internet and entertainment group Naspers into its parent company Delivery Hero.

Full Story >>

New Delhi [India], May 22 (ANI): Fintech start-up Zeta, which offers digital employee benefits for tax optimisation, has tied up with Sodexo Benefits and Rewards India for administration of digital employee benefits in the country.

Full Story >>

Mumbai [India], May 22 (ANI-Businesswire India): The India Meteorological Department (IMD's) recent prediction of favourable monsoon in India is likely to have a positive impact for companies in the agricultural sector like Ruchi Soya Industries Limited.

Full Story >>

New Delhi [India], May 22 (ANI): As per the joint study conducted by ASSOCHAM and PwC, in India, about 10 to 15 percent of wastes produced by industries are hazardous and the generation of hazardous wastes is increasing at the rate of two to five percent per year.

Full Story >>

New Delhi [India], May 22 (ANI-NewsVoir): It's time for hunger pangs and cravings for home cooked food well, Noodles, Pastas, dosas, juices, smoothies and soups. Just name it and you will be up for making it! If your kitchen is equipped with the perfect Kitchen Appliances, making a variety of these scrumptious, healthy, fresh and hygienic dishes is no longer a time consuming process. "KENT Smart chef appliances" has introduced the all new and innovative KENT Noodles & Pasta Maker and KENT Turbo Grinder and Blender to cook healthy and cook fast.

Full Story >>

To land CPEC-linked jobs, more Pak students learning Chinese

Updated: May 22, 2017 12:41 IST     

Islamabad [Pakistan], May 22 (ANI): The impact of the China-Pakistan Economic Corridor project, it seems, is being felt in educational institutions in the country, for more and more than students have reportedly taken to learning the Chinese language for short and long term benefit.

Full Story >>

Maharashtra Assembly passes GST Bill

Updated: May 22, 2017 12:02 IST     

New Delhi [India], May 22 (ANI): The Maharashtra Assembly on Monday passed the Goods and Services Tax (GST) Bill in a session of its lower house.

Full Story >>

Bangalore [India], May 22 (ANI-Businesswire India): L&T Technology Services Limited, a leading global pure-play engineering services company, announced it has been positioned in the "Winners Circle" by HfS Research, The Services Research Company in

Full Story >>