New Delhi: India is set to emerge as the manufacturing hub for Chinese consumer durables maker Haier’s exports to the neighbouring markets and African region.
Logistically, it makes sense to make India the production base for this region and Africa, according to Eric Braganza, president, Haier Appliances (India). The company would initially export refrigerators and washing machines, most of which would be produced in India. “Over the next two years, about 25% revenue of Indian operations would come from exports,” he added.
With the Buoyant demand in the domestic market and increasing exports, the company would need to set up a second manufacturing plant in about three years from now, said Braganza. “It would be based in the northern part of India. Before that, the company would expand its production facility at Ranjangaon near Pune by 2014, where it produces refrigerators and few models of washing machines at present.
Haier India, which is a wholly-owned subsidiary of the $20-billion Chinese parent, intends to produce almost all its models across categories in India, including air-conditioning machines and water heaters, going forward, said Braganza. It currently imports all TV panels and water heaters from China.
Quantum of investments for the capacity augmentation at Ranjangaon and the second facility is yet to be firmed up, he added. The company has so far invested about Rs 120 crore at the Ranjangaon factory.
Haier targets revenue at Rs 1,250 crore in 2012, and Rs 1,600 crore in 2013 from Indian market, said Braganza. In 2011, the company had a turnover of more than Rs 970 crore.
At present, the Ranjangaon facility has an installed capacity of 10 lakh units of refrigerators annually, which will be ramped up to 20 lakh units in the next two years at an investment of about Rs 40 crore, he added.
This year, Haier will produce 6.5 lakh units of refrigerators.
In 2012, the company targets to sell about 4.8 lakh units of refrigerators, 2 lakh washing machines, 2.5 lakh TVs, 60,000 ACs and 55,000 water heaters in India.
Haier India currently has 170 exclusive stores, apart from being retailed from 4,500 multi-brand outlets. It is increasing this to 250 exclusive outlets and 6,000 other outlets by 2013. It employs 1,300 people.
Haier, which positions itself as the mid-market brand in India, claims a 12% market share in the deep freeze category, followed by 6% in refrigerator, 4-5% in washing machines and about 3% in the air-conditioning market in India. “We aim to have a three-fold market share within the next three years,” Braganza said.
Success in my Habit
Tuesday, October 30, 2012
Entertainment & media sector to touch Rs 1.75 lakh cr by 2016: Study
New Delhi: The entertainment and media industry in India is set to touch Rs 1.75 lakh crore by 2016, on the back of continued growth in advertising and increasing consumer spend, according to a joint study by industry body Confederation of Indian Industry (CII) and consulting firm PricewaterhouseCoopers (PwC).
The industry, which was estimated at Rs 80,000 crore in 2011, will grow at 17 per cent compounded annual growth rate (CAGR) between 2012 and 2016, according to the ‘Indian Entertainment & Media Outlook 2012’ report.
“The potential game-changers in the industry would be rising advertising and consumer spend, infrastructure and policy support,” it said.
The Indian entertainment and media industry has been identified as the fastest growing, followed by China (14 per cent), Russia (12 per cent) and Brazil (11 per cent).
The advertising segment, which contributes about 35 per cent of revenue in the entertainment and media industry in India, is dominated by television and print that constitute about 80 per cent of the pie, the study said, pointing out that both the segments will continue to dominate the industry over the next five years.
Rising disposable incomes, coupled with macroeconomic stability, will also drive rapid growth in consumer spend in the industry, the study said.
“Increased advertising and consumer spend will take the industry to desired heights. This will be fuelled by technological innovation, leading to better quality of media content being consumed. Internet access will be a key enabler in driving the growth,” said Smita Jha, leader (entertainment and media practice) at PwC India.
However, the study also pointed out that the growth largely came from the escalating internet segment, which has the potential to outshine the print sector by 2014.
“We expect that entertainment content being accessed through different media, and innovation in digital content will drive the advertising spend,” said a statement by CII.
Consumers primarily spend on television subscription, film admissions and print circulation, the study noted. However, the average annual spend per capita in India is just $7, while it is $22 in China and $65 in Brazil, it said. These figures, again, pale in comparison with that of the UK ($566), US ($477) and Japan ($459).
“Working to attain the target of $100 billion in the coming years will not only benefit industry, but also create large-scale employment, and help achieve India’s goal of being a knowledge-driven economy through effective media,” said Chandrajit Banerjee, director-general, CII.
In India, internet access and gaming segments have emerged as the fastest-growing at 57 per cent and 33 per cent CAGR, respectively. Gaming, still a small contributor to the overall industry, has been growing due to the rising popularity of mobile and online and social media gaming, the study noted.
The industry, which was estimated at Rs 80,000 crore in 2011, will grow at 17 per cent compounded annual growth rate (CAGR) between 2012 and 2016, according to the ‘Indian Entertainment & Media Outlook 2012’ report.
“The potential game-changers in the industry would be rising advertising and consumer spend, infrastructure and policy support,” it said.
The Indian entertainment and media industry has been identified as the fastest growing, followed by China (14 per cent), Russia (12 per cent) and Brazil (11 per cent).
The advertising segment, which contributes about 35 per cent of revenue in the entertainment and media industry in India, is dominated by television and print that constitute about 80 per cent of the pie, the study said, pointing out that both the segments will continue to dominate the industry over the next five years.
Rising disposable incomes, coupled with macroeconomic stability, will also drive rapid growth in consumer spend in the industry, the study said.
“Increased advertising and consumer spend will take the industry to desired heights. This will be fuelled by technological innovation, leading to better quality of media content being consumed. Internet access will be a key enabler in driving the growth,” said Smita Jha, leader (entertainment and media practice) at PwC India.
However, the study also pointed out that the growth largely came from the escalating internet segment, which has the potential to outshine the print sector by 2014.
“We expect that entertainment content being accessed through different media, and innovation in digital content will drive the advertising spend,” said a statement by CII.
Consumers primarily spend on television subscription, film admissions and print circulation, the study noted. However, the average annual spend per capita in India is just $7, while it is $22 in China and $65 in Brazil, it said. These figures, again, pale in comparison with that of the UK ($566), US ($477) and Japan ($459).
“Working to attain the target of $100 billion in the coming years will not only benefit industry, but also create large-scale employment, and help achieve India’s goal of being a knowledge-driven economy through effective media,” said Chandrajit Banerjee, director-general, CII.
In India, internet access and gaming segments have emerged as the fastest-growing at 57 per cent and 33 per cent CAGR, respectively. Gaming, still a small contributor to the overall industry, has been growing due to the rising popularity of mobile and online and social media gaming, the study noted.
Indian Institute of Science makes it to Global Employability List, ranked 35th
Bengaluru: The 103-year-old Indian Institute of Science (IISc) is the only Indian institution to figure in the Global Employability List 2012. The Bangalore-based research institution , which first made it to the list in 2011, has moved up from 134 to 35.
The list, which includes top-notch institutions like Harvard, Yale, Cambridge, OxfordBSE 0.00 %, Stanford, MIT, Columbia , Princeton, Imperial College of London and Goethe-University , Frankfurt , in its top 10, was done in collaboration with French consulting firm Emerging and German institute Trendence , which specializes in recruitment. "Employers are always looking for strong skill sets from employees. Since researchers and doctoral students have strong technical skills in specialized areas, they are much sought after by employers," IISc director P Balaram, said on Thursday.
"The strength of IISc lies in its ability to recruit talented faculty and bright students from all over the country . Heterogeneity has always helped the institution in its quest for new and fresh ideas. Our students, who are brilliant , are easily employable after they complete their course," he said. Interestingly, Asian universities , particularly Chinese , are creating an eco-system to foster academic excellence — Peking University is one among four mainland Chinese varsities in the top 100.
Times View
The Indian Institute of Science, Bangalore must be congratulated for not only staying on this elite list, but actually jumping nearly a hundred places up the ranking. At the same time, we must worry about why no other Indian university makes it to the top 150 in the world in terms of the employability of their graduates. In contrast, for instance, China has four. Clearly, much more needs to be done, both in terms of investments in higher education and ensuring that the investment is well-utilised if we are not to miss the bus. Our huge population can be an asset if it is provided the right skills, if not it can become a huge problem.
The list, which includes top-notch institutions like Harvard, Yale, Cambridge, OxfordBSE 0.00 %, Stanford, MIT, Columbia , Princeton, Imperial College of London and Goethe-University , Frankfurt , in its top 10, was done in collaboration with French consulting firm Emerging and German institute Trendence , which specializes in recruitment. "Employers are always looking for strong skill sets from employees. Since researchers and doctoral students have strong technical skills in specialized areas, they are much sought after by employers," IISc director P Balaram, said on Thursday.
"The strength of IISc lies in its ability to recruit talented faculty and bright students from all over the country . Heterogeneity has always helped the institution in its quest for new and fresh ideas. Our students, who are brilliant , are easily employable after they complete their course," he said. Interestingly, Asian universities , particularly Chinese , are creating an eco-system to foster academic excellence — Peking University is one among four mainland Chinese varsities in the top 100.
Times View
The Indian Institute of Science, Bangalore must be congratulated for not only staying on this elite list, but actually jumping nearly a hundred places up the ranking. At the same time, we must worry about why no other Indian university makes it to the top 150 in the world in terms of the employability of their graduates. In contrast, for instance, China has four. Clearly, much more needs to be done, both in terms of investments in higher education and ensuring that the investment is well-utilised if we are not to miss the bus. Our huge population can be an asset if it is provided the right skills, if not it can become a huge problem.
16 States and Union Territories Sign Tripartite Agreements for Laying Digital Highways Under National Optical Fibre Network
New Delhi: The Minister of Communications & IT Sh. Kapil Sibal today called the National Optical Fibre Network (NOFN) ---a project, which would connect all the 2, 50,000 Gram Panchayats (GPs) in the country through Optical Fibre Cable (OFC) in two years—as a paradigm shift which would transform the way India works. Sh Sibal was speaking at a function in New Delhi where 13 State governments and 3 Union territories signed tripartite Memorandums of Understanding for free Right of Way (RoW) with the Central Government and Bharat Broadband Network Limited (BBNL--the SPV incorporated for execution of the project).
Calling it the ‘end of distance”, the Minister said from people reaching out to the government we have now come to the government reaching out to the people. He emphasized that the content that would be “riding” on the virtual highway would be equally important, and its success would lay on it being accessible and affordable to the common man. Sh Sibal said it is now upto the State governments to digitize all data, and make it interoperable not just within the state but also inside the country.
Sh Ashok Gehlot and Sh Vijay Bahuguna, Chief Ministers of Rajasthan and Uttarakhand respectively were among the representatives of State governments and Union Territories who signed the MoUs.
The number of Gram Panchayats covered in these states/UTs are as below.
S.No. State Name No. of Gram Panchayats
1. ANDHRA PRADESH 21,693
2. ARUNACHAL PRADESH 1,756
3. CHHATTISSGARH 9,770
4. DADRA AND NAGAR HAVELI 11
5. DAMAN AND DIU 14
6. JHARKHAND 4,423
7. KARNATAKA 5,631
8. KERALA 977
9. MADHYA PRADESH 23,024
10. MANIPUR 2,795
11. MIZORAM 776
12. PUDUCHERRY 98
13. RAJASTHAN 9,192
14. TRIPURA 1,038
15. UTTAR PRADESH 51,974
16. UTTARAKHAND 7,555
Total 140,727
In all 1,40,727 GPs will get covered by Optical Fibre Network in these States and UTs.
The Central Government, through Universal Service Obligation Fund (USOF), will fund the project while the contribution of State Government would be by providing free Right of Way (RoW) for laying OFC. The Bharat Broadband Network Ld.(BBNL) will soon commence the work in these States/UTs immediately taking OFC to Gram Panchayats and in remaining States work will be taken by BBNL as and when States are ready to sign MoU.
With the availability of NOFN at 2,50,000 Gram Panchayats, a minimum bandwidth of 100 Mbps will be available at each GP and will lead to proliferation of broadband services.
Benefits to States will be as below:
This will empower rural masses by giving them access to information, public services including those of education, health and financial inclusion.
Various applications for Panchayats for planning, management, monitoring and payments under various government schemes (e.g. MNREGA, PDS, Land Records, Birth/Death Certificates, Digital Literacy, etc.), e-Governance, education, health, employment, agriculture and commerce can be launched using this network
As access service providers like Mobile operators, Internet Service Providers, Cable TV operators, content providers etc. launch their access network and services using NOFN, it will result in creation of local employment, revenue generation and growth of GDP leading to overall prosperity of the State.
Sh Sibal also launched the portal of Bharat Broadband Network Ld. The website is www.bbnl.nic.in
Calling it the ‘end of distance”, the Minister said from people reaching out to the government we have now come to the government reaching out to the people. He emphasized that the content that would be “riding” on the virtual highway would be equally important, and its success would lay on it being accessible and affordable to the common man. Sh Sibal said it is now upto the State governments to digitize all data, and make it interoperable not just within the state but also inside the country.
Sh Ashok Gehlot and Sh Vijay Bahuguna, Chief Ministers of Rajasthan and Uttarakhand respectively were among the representatives of State governments and Union Territories who signed the MoUs.
The number of Gram Panchayats covered in these states/UTs are as below.
S.No. State Name No. of Gram Panchayats
1. ANDHRA PRADESH 21,693
2. ARUNACHAL PRADESH 1,756
3. CHHATTISSGARH 9,770
4. DADRA AND NAGAR HAVELI 11
5. DAMAN AND DIU 14
6. JHARKHAND 4,423
7. KARNATAKA 5,631
8. KERALA 977
9. MADHYA PRADESH 23,024
10. MANIPUR 2,795
11. MIZORAM 776
12. PUDUCHERRY 98
13. RAJASTHAN 9,192
14. TRIPURA 1,038
15. UTTAR PRADESH 51,974
16. UTTARAKHAND 7,555
Total 140,727
In all 1,40,727 GPs will get covered by Optical Fibre Network in these States and UTs.
The Central Government, through Universal Service Obligation Fund (USOF), will fund the project while the contribution of State Government would be by providing free Right of Way (RoW) for laying OFC. The Bharat Broadband Network Ld.(BBNL) will soon commence the work in these States/UTs immediately taking OFC to Gram Panchayats and in remaining States work will be taken by BBNL as and when States are ready to sign MoU.
With the availability of NOFN at 2,50,000 Gram Panchayats, a minimum bandwidth of 100 Mbps will be available at each GP and will lead to proliferation of broadband services.
Benefits to States will be as below:
This will empower rural masses by giving them access to information, public services including those of education, health and financial inclusion.
Various applications for Panchayats for planning, management, monitoring and payments under various government schemes (e.g. MNREGA, PDS, Land Records, Birth/Death Certificates, Digital Literacy, etc.), e-Governance, education, health, employment, agriculture and commerce can be launched using this network
As access service providers like Mobile operators, Internet Service Providers, Cable TV operators, content providers etc. launch their access network and services using NOFN, it will result in creation of local employment, revenue generation and growth of GDP leading to overall prosperity of the State.
Sh Sibal also launched the portal of Bharat Broadband Network Ld. The website is www.bbnl.nic.in
India and Spain Sign MOU on Technical Co-Operation in the Field of Railway Sector
New Delhi: Memorandum of Understanding between the Indian Railways and RENFE-Operadora and ADIF (Spanish Railways Infrastructure Manager) of Spain on technical cooperation in the field of Railway sector was signed by the Minister of Road Transport & Highways and Minister of Railways, Dr. C.P.Joshi and visiting Spain Minister of Public Works and Transport, Ms. Ana Pastor Julián, here today.
Under this MOU, both the countries are to promote cooperation and information exchange in the areas of High Speed Railway, upgradation of speed of passenger trains on existing lines, improving safety of train operations, modernization of Rolling Stock, construction and maintenance technologies for fixed infrastructure – Track, Bridges, Tunnels, OHE, Power Supply Systems, Signaling and Telecommunications and other cooperation in railway related technology developments.
Under this MOU, both the countries are to promote cooperation and information exchange in the areas of High Speed Railway, upgradation of speed of passenger trains on existing lines, improving safety of train operations, modernization of Rolling Stock, construction and maintenance technologies for fixed infrastructure – Track, Bridges, Tunnels, OHE, Power Supply Systems, Signaling and Telecommunications and other cooperation in railway related technology developments.
IBS Software Services acquires US-based hospitality company Hotel Booking Solutions
Kochi: IBS Software Services, a leading provider of IT solutions for the travel, transportation and logistic industries, has acquired Atlanta based Hotel Booking Solutions (HBSi).
IBS acquired HBSi by buying over the entire shareholding of Crosslink Capital, the San Francisco based leading private equity and venture capital firm. Crosslinks Capital with over $1.8 billion in investments in around 100 companies, holds around 96% stake in HBSi.
This multi-million dollar acquisition will bring to IBS' fold over hundred leading players in the hospitality industry including Starwood, Harrahs, Raffles, Ramada, Fairmont and Kerzner on the supply partner side as well as Expedia, Orbitz and Travelocity on the distribution partner side.
IBS has made six strategic acquisition - one in India, two in Europe and three in the USA - in its 15 year history, expanding its solution portfolio to cover travel, hospitality and aircraft engineering areas.
"Strategic acquisition of companies in the industry we operate in is a deliberate growth strategy of IBS to widen our bouquet of offerings to the travel, transportation and logistics industries and to helps us gain domain strength, expand our customer base and accelerate adoption of business innovation,'' said Mr. VK Mathews, executive chairman of The IBS Group.
HBSi is a B2B travel technology and services firm that provides distribution services to leading hotel companies and travel suppliers and has over 80 multinational hotel chains and over 30 leading distributers in its expanding client list.
IBS acquired HBSi by buying over the entire shareholding of Crosslink Capital, the San Francisco based leading private equity and venture capital firm. Crosslinks Capital with over $1.8 billion in investments in around 100 companies, holds around 96% stake in HBSi.
This multi-million dollar acquisition will bring to IBS' fold over hundred leading players in the hospitality industry including Starwood, Harrahs, Raffles, Ramada, Fairmont and Kerzner on the supply partner side as well as Expedia, Orbitz and Travelocity on the distribution partner side.
IBS has made six strategic acquisition - one in India, two in Europe and three in the USA - in its 15 year history, expanding its solution portfolio to cover travel, hospitality and aircraft engineering areas.
"Strategic acquisition of companies in the industry we operate in is a deliberate growth strategy of IBS to widen our bouquet of offerings to the travel, transportation and logistics industries and to helps us gain domain strength, expand our customer base and accelerate adoption of business innovation,'' said Mr. VK Mathews, executive chairman of The IBS Group.
HBSi is a B2B travel technology and services firm that provides distribution services to leading hotel companies and travel suppliers and has over 80 multinational hotel chains and over 30 leading distributers in its expanding client list.
Sanjiv Goenka group to pick 49.5% in Firstsource BPO for Rs 400 cr
Kolkata: RP-Sanjiv Goenka group has announced plans to acquire 49.5 per cent stake in Firstsource Solutions Ltd — an IT BPO firm — for around Rs 400 crore. Firstsource was promoted by ICICI Bank and other ICICI-group companies.
The acquisition will be made through Spen Liq Private Ltd, a wholly-owned subsidiary of RP-Sanjiv Goenka group flagship CESC Ltd. Firstsource operates in verticals such as banking and financial services, healthcare and telecommunications and media.
The BPO firm will issue 22.69 crore equity shares (of Rs 10 face value) at Rs 12.10 to Spen Liq on a preferential basis. This will offer Spen Liq over 34.5 per cent stake at around Rs 274 crore.
Share purchase
In a separate arrangement, Spen Liq will acquire five per cent stake from each of the three major shareholders — ICICI (promoter), Aranda (step-down subsidiary of Temasek) and Metavante (Fidelity arm) — in Firstsource.
This will lead to acquisition of 15 per cent of the expanded capital base at around Rs 120 crore.
Open offer
The RP-Sanjiv Goenka group also announced a mandatory open offer for acquisition of another 19.8 crore equity shares — totalling 26 per cent of its expanded capital base — at Rs 12.20 a share.
The offer may cost Spen Liq a maximum of Rs 240 crore. Firstsource shares closed at Rs 14.24, up by nearly 8 per cent at BSE on Thursday.
Business Interests
“Given the current limitations of growth opportunities in the power sector, we have been looking at entering the BPO space for a while,” Sanjiv Goenka said.
The acquisition will be made through Spen Liq Private Ltd, a wholly-owned subsidiary of RP-Sanjiv Goenka group flagship CESC Ltd. Firstsource operates in verticals such as banking and financial services, healthcare and telecommunications and media.
The BPO firm will issue 22.69 crore equity shares (of Rs 10 face value) at Rs 12.10 to Spen Liq on a preferential basis. This will offer Spen Liq over 34.5 per cent stake at around Rs 274 crore.
Share purchase
In a separate arrangement, Spen Liq will acquire five per cent stake from each of the three major shareholders — ICICI (promoter), Aranda (step-down subsidiary of Temasek) and Metavante (Fidelity arm) — in Firstsource.
This will lead to acquisition of 15 per cent of the expanded capital base at around Rs 120 crore.
Open offer
The RP-Sanjiv Goenka group also announced a mandatory open offer for acquisition of another 19.8 crore equity shares — totalling 26 per cent of its expanded capital base — at Rs 12.20 a share.
The offer may cost Spen Liq a maximum of Rs 240 crore. Firstsource shares closed at Rs 14.24, up by nearly 8 per cent at BSE on Thursday.
Business Interests
“Given the current limitations of growth opportunities in the power sector, we have been looking at entering the BPO space for a while,” Sanjiv Goenka said.
Honda Cars India begins exporting Brio to S. Africa
Mumbai: Honda Cars India intends to export 1,600 units of its hatchback Brio to the South African markets by the end of this financial year.
The passenger car manufacturer is also gearing up to launch a diesel sedan, its first in India, and next generation of its sports utility vehicle (SUV) Honda CR-V next year.
Honda Cars India Ltd (HCIL) today flagged off the first consignment of 390 units of Honda Brio to South Africa. The company had exported a total of 1,028 cars, including the City, Jazz and Accord, to the SAARC countries, in the past 14 years, and now has added Brio to the export portfolio.
“Honda Brio is the first car to be exported to South Africa by HCIL and today's consignment of 390 cars is a significant milestone in our journey. We are planning to export more than 1,600 units of Brio to South Africa and Southern African Development Community (SADC) countries by March,” said HCIL President and Chief Executive Officer Hironori Kanayama.
On the launch of diesel car, HCIL Senior Vice-President (sales and marketing) Jnaneswar Sen said it would be an entry-level sedan.
The company would then look at launching other diesel models.
HCIL would also launch its next generation Honda CR-V, which will replace the existing version.
He, however, did not divulge a specific date for the launch nor other features of both the sedan and the CR-V.
The passenger car manufacturer is also gearing up to launch a diesel sedan, its first in India, and next generation of its sports utility vehicle (SUV) Honda CR-V next year.
Honda Cars India Ltd (HCIL) today flagged off the first consignment of 390 units of Honda Brio to South Africa. The company had exported a total of 1,028 cars, including the City, Jazz and Accord, to the SAARC countries, in the past 14 years, and now has added Brio to the export portfolio.
“Honda Brio is the first car to be exported to South Africa by HCIL and today's consignment of 390 cars is a significant milestone in our journey. We are planning to export more than 1,600 units of Brio to South Africa and Southern African Development Community (SADC) countries by March,” said HCIL President and Chief Executive Officer Hironori Kanayama.
On the launch of diesel car, HCIL Senior Vice-President (sales and marketing) Jnaneswar Sen said it would be an entry-level sedan.
The company would then look at launching other diesel models.
HCIL would also launch its next generation Honda CR-V, which will replace the existing version.
He, however, did not divulge a specific date for the launch nor other features of both the sedan and the CR-V.
Cabinet nod for rail link project to connect Imphal
New Delhi: The Cabinet Committee on Infrastructure (CCI) on Thursday approved the Railway Ministry’s proposal to extend the new broad gauge rail-link from Imphal Road (Tupul) to Imphal and the updated cost of the entire project as Rs 4,444 crore.
The project, on which Rs 682 crore has been spent till March 31, 2011, will be funded 25 per cent from General Budgetary Support (GBS) for Railways and 75 per cent from the Finance Ministry. The project will be completed by March 2016.
This project will cover Imphal East, Tamenglong and Senapati districts of Manipur. This Jiribam-Imphal new line project, on completion, will provide rail connectivity to Imphal with the national mainstream. It would also make possible direct movement of freight/passenger from this region to other parts of the country.
The project, on which Rs 682 crore has been spent till March 31, 2011, will be funded 25 per cent from General Budgetary Support (GBS) for Railways and 75 per cent from the Finance Ministry. The project will be completed by March 2016.
This project will cover Imphal East, Tamenglong and Senapati districts of Manipur. This Jiribam-Imphal new line project, on completion, will provide rail connectivity to Imphal with the national mainstream. It would also make possible direct movement of freight/passenger from this region to other parts of the country.
Approval of National Policy on Electronics 2012
The Union Cabinet today approved the National Policy on Electronics 2012. The draft National Policy on Electronics was released for public consultation and it has now been finalized based on comments from various stakeholders.
India is one of the fastest growing markets of electronics in the world. There is potential to develop the Electronic System and Design and Manufacturing (ESDM) sector to meet our domestic demand as well as to use the capabilities so created to successfully export ESDM products from the country. The National Policy on Electronics aims to address the issue with the explicit goal of transforming India into a premier ESDM hub.
The strategies include setting up of a National Electronics Mission with industry participation and renaming the Department of Information Technology as Department of Electronics and Information Technology (Deity). The Department has since been renamed on February 26, 2012.
The policy is expected to create an indigenous manufacturing eco-system for electronics in the country. It will foster the manufacturing of indigenously designed and manufactured chips creating a more cyber secure ecosystem in the country. It will enable India to tap the great economic potential that this knowledge sector offers. The increased development and manufacturing in the sector will lead to greater economic growth through more manufacturing and consequently greater employment in the sector.
The Policy envisages that a turnover of USD 400 billion will create an employment for two million people.
ESDM is of strategic importance as well. Not only in internal security and defence, the pervasive deployment of electronics in civilian domains such as telecom, power, railways, civil aviation, etc. can have serious consequences of disruption of service. This renders tremendous strategic importance to the sector. The country, therefore, cannot be totally dependent on imported electronic components and products.
The key objectives of the Policy are:
To create an eco-system for a globally competitive Electronic System Design and Manufacturing (ESDM) sector in the country to achieve a turnover of about USD 400 billion by 2020 involving investment of about USD 100 billion and employment to around 28 million people at various levels.
To build on the emerging chip design and embedded software industry to achieve global leadership in Very Large Scale Integration (VLSI), chip design and other frontier technical areas and to achieve a turnover of USD 55 billion by 2020.
To build a strong supply chain of raw materials, parts and electronic components to raise the indigenous availability of these inputs from the present 20-25 per cent to over 60 per cent by 2020.
To increase the export in ESDM sector from USD 5.5 billion to USD 80 billion by 2020.
To significantly enhance availability of skilled manpower in the ESDM sector. Special focus for augmenting postgraduate education and to produce about 2500 PhDs annually by 2020.
To create an institutional mechanism for developing and mandating standards and certification for electronic products and services to strengthen quality assessment infrastructure nationwide.
To develop an appropriate security ecosystem in ESDM.
To create long-term partnerships between ESDM and strategic and core infrastructure sectors - Defence, Atomic Energy, Space, Railways, Power, Telecommunications, etc.
To become a global leader in creating Intellectual Property (IP) in the ESDM sector by increasing fund flow for R&D, seed capital and venture capital for start-ups in the ESDM and nanoelectronics sectors.
To develop core competencies in strategic and core infrastructure sectors like telecommunications, automotive, avionics, industrial, medical, solar, Information and Broadcasting, Railways, etc through use of ESDM in these sectors.
To use technology to develop electronic products catering to domestic needs, including rural needs and conditions, as well as international needs at affordable price points.
To become a global leader in the Electronic Manufacturing Services (EMS) segment by promoting progressive higher value addition in manufacturing and product development.
To expedite adoption of best practices in e-waste management.
To source, stockpile and promote indigenous exploration and mining of rare earth metals required for manufacture of electronic components.
To achieve these objectives, the policy proposes the following strategies:
Creating eco-system for globally competitive ESDM sector: The strategies include provision of fiscal incentives for investment, setting up of electronic manufacturing clusters, preferential market access to domestically manufactured electronic products, setting up of semiconductor wafer fabrication facilities, industry friendly and stable tax regime. Based on Cabinet approval, a high level Empowered committee has been constituted to identify and shortlist technology and investors for setting up two semiconductor wafer manufacturing fabrication facilities. Based on another Cabinet approval a policy for providing preference to domestically manufactured electronic goods has been announced. Separate proposals have also been considered by the Cabinet for approval of Modified Special Incentive Package for the ESDM Sector and for setting up of Electronics Manufacturing Clusters (EMCs).
Promotion of Exports: The strategies include aggressive marketing of India as an investment destination and providing incentives for export,
Human Resource Development: The strategies include involvement of private sector, universities and institutions of learning for scaling up of requisite capacities at all levels for the projected manpower demand. A specialized Institute for semiconductor chip design is also proposed.
Developing and mandating standards to curb inflow of sub-standard and unsafe electronic products by mandating technical and safety standards which conform to international standards.
Cyber security: To create a complete secure cyber eco-system in the country, through suitable design and development of indigenous appropriate products through frontier technology/product oriented research, testing and validation of security of products.
Strategic electronics: The strategies include creating long-term partnerships between domestic ESDM industry and strategic sectors for sourcing products domestically and providing Defense Offset obligations for electronic procurements through ESDM products.
Creating ecosystem for vibrant innovation and R&D in the ESDM sector including nanoelectronics. The strategy includes creation of an Electronic Development Fund.
Electronics in other sectors: The strategy includes supporting and : developing expertise in the electronics in the following sectors of economy: automotive, avionics, Light Emitting Diodes (LEDs), Industrial, medical, solar photovoltaics, Information and Broadcasting, Telecommunications, Railways, Intelligent Transport Systems, and Games and Toys.
Handling e-waste: The strategy includes various initiatives to facilitate environment friendly e-waste handling policies.
Background:
The Electronics industry reported at USD 1.75 trillion is the largest and fastest growing manufacturing industry in the world. It is expected to reach USD 2.4 trillion by 2020. The demand in the Indian market was USD 45 billion in 2008-09 and is expected to reach USD 400 billion by 2020. Domestic demand is expected to be driven by growth in income levels leading to higher off-take of electronics products, automation demands of corporate sector and the government's focus on e-governance. The domestic production in 2008-09 was about USD 20 billion. However, the actual value-addition in the domestically produced electronic product is very low, ranging between 5 to 10 percent in most cases. At the current rate of growth, domestic production can cater to a demand of USD 100 billion in 2020 as against a demand of USD 400 billion and the rest would have to be met by imports. This aggregates to a demand supply gap of nearly USD 300 billion by 2020. Unless the situation is corrected, it is likely that by 2020, electronics import may far exceed oil imports. This fact goes unnoticed because electronics, as a "meta resource" forms a significant part of all machines and equipment imported, which are classified in their final sectoral forms, for example, automobiles, aviation, health equipment, media and broadcasting, defence armaments, etc.
Electronics is characterized by high velocity of technological change. Consequently the life cycle of products is declining. As a result, the value of design and development in the product has increased quite significantly. Given India's growing strength in chip design and embedded software, the increasing importance of design in product development has potential to make India a favoured destination for ESDM.
Electronic components, which are the basis of an electronic product, are low volume-low weight, cheap and easy to transport across the globe. Moreover, under the Information Technology Agreement-1 (ITA-1) of the World Trade Organization (WTO), which came into force in 1997, a large number of electronic components and products are bound with zero tariffs making trade unrestricted across international borders. Under the Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) with various countries, the import of electronics hardware from these countries is allowed either at zero duty or at a duty which is lower than the normal duty rate.
India is one of the fastest growing markets of electronics in the world. There is potential to develop the Electronic System and Design and Manufacturing (ESDM) sector to meet our domestic demand as well as to use the capabilities so created to successfully export ESDM products from the country. The National Policy on Electronics aims to address the issue with the explicit goal of transforming India into a premier ESDM hub.
The strategies include setting up of a National Electronics Mission with industry participation and renaming the Department of Information Technology as Department of Electronics and Information Technology (Deity). The Department has since been renamed on February 26, 2012.
The policy is expected to create an indigenous manufacturing eco-system for electronics in the country. It will foster the manufacturing of indigenously designed and manufactured chips creating a more cyber secure ecosystem in the country. It will enable India to tap the great economic potential that this knowledge sector offers. The increased development and manufacturing in the sector will lead to greater economic growth through more manufacturing and consequently greater employment in the sector.
The Policy envisages that a turnover of USD 400 billion will create an employment for two million people.
ESDM is of strategic importance as well. Not only in internal security and defence, the pervasive deployment of electronics in civilian domains such as telecom, power, railways, civil aviation, etc. can have serious consequences of disruption of service. This renders tremendous strategic importance to the sector. The country, therefore, cannot be totally dependent on imported electronic components and products.
The key objectives of the Policy are:
To create an eco-system for a globally competitive Electronic System Design and Manufacturing (ESDM) sector in the country to achieve a turnover of about USD 400 billion by 2020 involving investment of about USD 100 billion and employment to around 28 million people at various levels.
To build on the emerging chip design and embedded software industry to achieve global leadership in Very Large Scale Integration (VLSI), chip design and other frontier technical areas and to achieve a turnover of USD 55 billion by 2020.
To build a strong supply chain of raw materials, parts and electronic components to raise the indigenous availability of these inputs from the present 20-25 per cent to over 60 per cent by 2020.
To increase the export in ESDM sector from USD 5.5 billion to USD 80 billion by 2020.
To significantly enhance availability of skilled manpower in the ESDM sector. Special focus for augmenting postgraduate education and to produce about 2500 PhDs annually by 2020.
To create an institutional mechanism for developing and mandating standards and certification for electronic products and services to strengthen quality assessment infrastructure nationwide.
To develop an appropriate security ecosystem in ESDM.
To create long-term partnerships between ESDM and strategic and core infrastructure sectors - Defence, Atomic Energy, Space, Railways, Power, Telecommunications, etc.
To become a global leader in creating Intellectual Property (IP) in the ESDM sector by increasing fund flow for R&D, seed capital and venture capital for start-ups in the ESDM and nanoelectronics sectors.
To develop core competencies in strategic and core infrastructure sectors like telecommunications, automotive, avionics, industrial, medical, solar, Information and Broadcasting, Railways, etc through use of ESDM in these sectors.
To use technology to develop electronic products catering to domestic needs, including rural needs and conditions, as well as international needs at affordable price points.
To become a global leader in the Electronic Manufacturing Services (EMS) segment by promoting progressive higher value addition in manufacturing and product development.
To expedite adoption of best practices in e-waste management.
To source, stockpile and promote indigenous exploration and mining of rare earth metals required for manufacture of electronic components.
To achieve these objectives, the policy proposes the following strategies:
Creating eco-system for globally competitive ESDM sector: The strategies include provision of fiscal incentives for investment, setting up of electronic manufacturing clusters, preferential market access to domestically manufactured electronic products, setting up of semiconductor wafer fabrication facilities, industry friendly and stable tax regime. Based on Cabinet approval, a high level Empowered committee has been constituted to identify and shortlist technology and investors for setting up two semiconductor wafer manufacturing fabrication facilities. Based on another Cabinet approval a policy for providing preference to domestically manufactured electronic goods has been announced. Separate proposals have also been considered by the Cabinet for approval of Modified Special Incentive Package for the ESDM Sector and for setting up of Electronics Manufacturing Clusters (EMCs).
Promotion of Exports: The strategies include aggressive marketing of India as an investment destination and providing incentives for export,
Human Resource Development: The strategies include involvement of private sector, universities and institutions of learning for scaling up of requisite capacities at all levels for the projected manpower demand. A specialized Institute for semiconductor chip design is also proposed.
Developing and mandating standards to curb inflow of sub-standard and unsafe electronic products by mandating technical and safety standards which conform to international standards.
Cyber security: To create a complete secure cyber eco-system in the country, through suitable design and development of indigenous appropriate products through frontier technology/product oriented research, testing and validation of security of products.
Strategic electronics: The strategies include creating long-term partnerships between domestic ESDM industry and strategic sectors for sourcing products domestically and providing Defense Offset obligations for electronic procurements through ESDM products.
Creating ecosystem for vibrant innovation and R&D in the ESDM sector including nanoelectronics. The strategy includes creation of an Electronic Development Fund.
Electronics in other sectors: The strategy includes supporting and : developing expertise in the electronics in the following sectors of economy: automotive, avionics, Light Emitting Diodes (LEDs), Industrial, medical, solar photovoltaics, Information and Broadcasting, Telecommunications, Railways, Intelligent Transport Systems, and Games and Toys.
Handling e-waste: The strategy includes various initiatives to facilitate environment friendly e-waste handling policies.
Background:
The Electronics industry reported at USD 1.75 trillion is the largest and fastest growing manufacturing industry in the world. It is expected to reach USD 2.4 trillion by 2020. The demand in the Indian market was USD 45 billion in 2008-09 and is expected to reach USD 400 billion by 2020. Domestic demand is expected to be driven by growth in income levels leading to higher off-take of electronics products, automation demands of corporate sector and the government's focus on e-governance. The domestic production in 2008-09 was about USD 20 billion. However, the actual value-addition in the domestically produced electronic product is very low, ranging between 5 to 10 percent in most cases. At the current rate of growth, domestic production can cater to a demand of USD 100 billion in 2020 as against a demand of USD 400 billion and the rest would have to be met by imports. This aggregates to a demand supply gap of nearly USD 300 billion by 2020. Unless the situation is corrected, it is likely that by 2020, electronics import may far exceed oil imports. This fact goes unnoticed because electronics, as a "meta resource" forms a significant part of all machines and equipment imported, which are classified in their final sectoral forms, for example, automobiles, aviation, health equipment, media and broadcasting, defence armaments, etc.
Electronics is characterized by high velocity of technological change. Consequently the life cycle of products is declining. As a result, the value of design and development in the product has increased quite significantly. Given India's growing strength in chip design and embedded software, the increasing importance of design in product development has potential to make India a favoured destination for ESDM.
Electronic components, which are the basis of an electronic product, are low volume-low weight, cheap and easy to transport across the globe. Moreover, under the Information Technology Agreement-1 (ITA-1) of the World Trade Organization (WTO), which came into force in 1997, a large number of electronic components and products are bound with zero tariffs making trade unrestricted across international borders. Under the Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) with various countries, the import of electronics hardware from these countries is allowed either at zero duty or at a duty which is lower than the normal duty rate.
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