<ul><li>The COVID-19 pandemic triggered a massive demand for servers, internet connectivity and cloud usage.</li><li>The supply chain that more often than not started in China, which is a world leader in making semiconductor chips, broke as the world went into a lockdown.</li><li>Computers, <keyword id="6354775" type="TECHNOLOGY" weightage="20" keywordseo="Smartphones">smartphones</keyword>, cars and microwave ovens are only some of the products that heavily rely on semiconductor chips. </li><li>Check out the latest news and updates on <a href="https://www.businessinsider.in/" data-type="tilCustomLink" target="_blank">Business Insider</a>.</li></ul><keyword id="145965" type="TECHNOLOGY" weightage="20" keywordseo="semiconductors">Semiconductors</keyword> are typically silicon chips that perform control and memory functions in a wide range of products⁠ — from computers and smartphones to cars and microwave ovens, to name a few. And there are very few of them, compared to the demand, since the pandemic. So much so that car makers like Ford, Nissan, Volkswagen, Fiat Chrysler and Toyota recently cut back production citing a shortage in <a href="https://www.businessinsider.in/tech/news/india-needs-chipset-manufacturers-lots-of-them-here-is-why-/articleshow/81137745.cms">semiconductors.</a> And to fill that void that is stalling the manufacturing of electronic products, India may soon start offering a cash incentive, worth a whopping billion dollars, to companies that make semiconductor chips in India. “The government will give cash incentives of more than $1 billion to each company which will set up chip fabrication units,” an <a href="https://www.reuters.com/article/us-india-semiconductor-exclusive-idUSKBN2BN12J?taid=60643ff5a0a3570001acac1e&amp;utm_campaign=trueAnthem:+Trending+Content&amp;utm_medium=trueAnthem&amp;utm_source=twitter">unnamed government official told Reuters</a>. Private companies will be ordered to buy ‘made in India’ chips so that these new fabrication units have assured buyers for their product. As it stands today, demand is not a problem for chip makers anywhere in the world. There is a huge addressable market that is growing by the day with the proliferation of electric vehicles⁠ and fancy cars loaded features like Bluetooth connectivity and driver-assist, navigation and hybrid-electric systems. Here’s how the global demand for semiconductor stacks up around industries <table style="border-width: initial; border-style: none; background-color: rgb(255, 255, 255); font-size: 16px; line-height: 1.6em; box-shadow: none; width: 914px; font-family: Merriweather; padding-bottom: 10px !important; background-image: inherit !important; background-position: inherit !important; background-size: inherit !important; background-repeat: inherit !important; background-attachment: inherit !important; background-origin: inherit !important; background-clip: inherit !important;"></colgroup><tbody><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Category </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Demand Share </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Total Value </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Communication </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">33% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$136 billion </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Computer </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">28.50% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$117 billion </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Consumer </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">13.30% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$54.7 billion </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Automotive </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">12.20% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$50.2 billion </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Industrial </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">11.90% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$48.9 billion </td></tr><tr><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">Government </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">1.30% </td><td style="border-width: 0.990765pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: bottom; overflow: hidden; overflow-wrap: break-word;">$5.2 billion </td></tr></tbody></table>Source: Semiconductor Industry Association, 2020 cited by EY The COVID-19 pandemic triggered a massive demand for servers, internet connectivity and cloud usage as more people started working from home and, therefore, were in need for online collaboration. The pandemic broke the supply chain that more often than not started in China, which is a world leader in making semiconductor chips. The shortage of chips was worsened as soldiers from India and China locked horns in the Galwan valley in Ladakh. The arrival of imports from China were delayed due to the military and diplomatic standoff. A big part of India’s Atmanirbhar (self-reliance) programme is weaning itself from relying on China for key inputs. And the Narendra Modi administration seems to be wanting to get it done sooner than later. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/india-approves-pli-scheme-worth-10900-crore-in-the-food-processing-industry-fmcg-stocks-celebrate-the-news/articleshow/81777422.cms">India approves PLI scheme worth ₹10,900 crore in the food processing industry – FMCG stocks celebrate the news</a> <a href="https://www.businessinsider.in/tech/news/india-needs-chipset-manufacturers-lots-of-them-here-is-why-/articleshow/81137745.cms" data-type="tilCustomLink" target="_blank">India needs chipset manufacturers — lots of them. Here is why.</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/indian-banks-get-a-six-month-breather-to-comply-with-rbi-new-framework-for-auto-debit-payments/articleshow/81777455.cms">Indian banks get a six-month breather to comply with RBI new framework for auto-debit payments</a><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/indian-banks-get-a-six-month-breather-to-comply-with-rbi-new-framework-for-auto-debit-payments/articleshow/81777455.cms"></a>

Howzzat! A $1 billion cash reward for making semiconductor chips in India⁠ is under consideration

With Taiwanese electronics manufacturer <keyword id="1930805" type="General" weightage="20" keywordseo="Wistron" source="Orion">Wistron</keyword> selling its India operations to <keyword id="6355725" type="General" weightage="20" keywordseo="tata-group" source="Orion">Tata Group</keyword> for $125 million, Tata Electronics is going to become the first Indian company to manufacture new Apple iPhones in the country, which is a major fillip to the government's 'Make in India' initiative. Currently, iPhone 15 Plus, iPhone 12 and iPhone SE (second generation) are being manufactured/ assembled at Wistron's factory in Karnataka, which Tatas will take over. The company said in its regulatory filing that it will sell a 100 per cent stake in the unit Wistron InfoComm Manufacturing (India) Pvt. to Tata Electronics Pvt., following the board approval. The much-awaited deal has been finalised after strategic considerations in response to the reshaping of the group's product strategy and global manufacturing layout. Minister of State for Electronics and IT, Rajeev Chandrasekhar, said that within just two and a half years, Tata Group will start making iPhones from India for domestic and global markets. "PM Narendra Modi's visionary PLI scheme has already propelled India into becoming a trusted and major hub for smartphone manufacturing and exports. Congratulations to the Tata team for taking over Wistron operations," the minister posted on X. He said that this is a "great going for Apple in building a global supply chain from India with Indian companies at its helm". "MeitY stands fully in support in growth of global Indian electronics companies that will, in turn, support global electronic brands that want to make India their trusted manufacturing and talent partner," Chandrasekhar added. Industry experts said that with their ambition on semiconductors and EVs, it only makes sense for the Tata Group to gain expertise in manufacturing high-end iPhones in the country. "With the Wistron acquisition, Tata Group will get a leg-up on its electronics manufacturing ambitions with the iPhones, and the possibility of manufacturing top-end iPhone models as well in the near future. We anticipate 'Make in India' to gain further momentum, and India to emerge as a major fulcrum in the global electronics value chain," Prabhu Ram, Head-Industry Intelligence Group, CMR, told IANS. In the years ahead, the Tata Group has the potential to solidify their position as a pivotal player in the iPhone manufacturing ecosystem. Wistron's factory in Karnataka, that employs about 12,000 people, constitutes a major chunk of its business in the country. As the iPhone consumption increases in the country, Apple needs more suppliers to ramp up production here, as it reportedly aims to take away a significant chunk of manufacturing from China to countries like India and Vietnam. Driven by domestic manufacturing, Apple iPhones are set to garner 7 per cent market share in the Android-dominated smartphone market in India this year, according to latest data. Apple iPhone shipments grew 68 per cent (year-on-year) in the first half of this year in the country. CMR estimates the iPhone 15 shipments in the launch quarter (October-December period) to hover around 65 per cent, driven by an increased 'Make in India' initiative. For the first time, 'Make in India' iPhone 15 units were exported to other countries within a short span of time from its global launch last month. Apple received tremendous response to the iPhone 15 series in the country -- nearly 50 per cent more from last year. Apple had set a June quarter record in India, driven by the robust sales of iPhones, according to CEO <keyword id="191843" type="General" weightage="50" keywordseo="tim-cook" source="Orion">Tim Cook</keyword>. Tarun Pathak, Research Director at Counterpoint, told that Tatas' semiconductor ambitions are serious and came at a very important juncture amid India's digital goals. "First, they can leverage the semiconductor strength in their EV business and second, their chips can be aligned with Apple in the future and the learning curve will be great for them," Pathak told IANS. India is now the second-biggest manufacturing hub for mobile phones due to heavy investment from original equipment manufacturers, original design manufacturers and companies dealing in components and parts, according to Counterpoint. The country saw mobile phone exports worth $5.5 billion (over Rs 45,000 crore) in the April-August period in the current fiscal year (FY24), government and industry data showed. As per the estimates by the <keyword id="113018" type="General" weightage="50" keywordseo="department-of-commerce" source="Orion">Department of Commerce</keyword> and the <keyword id="7825659" type="General" weightage="50" keywordseo="india-cellular-and-electronics-association" source="Orion">India Cellular and Electronics Association</keyword> (ICEA), the April-August period saw mobile phone exports worth $5.5 billion, against $3 billion (about Rs 25,000 crore) in the same period in FY22-23. India is set to cross Rs 1,20,000 crore in mobile phone exports in the current fiscal year, with Apple leading the market with more than 50 per cent in FY24.

Tatas set to write new India iPhone manufacturing story post Wistron plant acquisition

<ul><li><keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword> has manufactured 2 billion smartphones between 2014 and 2022.</li><li>The country is now the second largest manufacturer of smartphones after China.</li><li>98% of the smartphones sold in India in 2022 were manufactured locally.</li></ul> The push to make India a hub for smartphone manufacturing as part of the Make in India initiative is yielding results. India has emerged as the second largest smartphone manufacturer after China. According to a<a href="https://www.counterpointresearch.com/india-mobile-phone-production/"> report</a> by Counterpoint Research, mobile phone production in India has crossed the 2 billion cumulative mark under the Make in India initiative during 2014-2022. <cmsannotation type="cmsannotation" annotationid="Increase in shipments" comment="subhead" text="Increase in shipments">Increase in shipments</cmsannotation> According to the report domestic production of smartphones is expected to hit 270 million this year, up from last year’s 250 million. Most smartphones sold in India presently are manufactured locally. Out of the 250 million smartphones produced last year, the country exported 20% of the devices. “In 2022, more than 98% of shipments in the overall Indian market were ‘Made in India’, compared to just 19% in 2014,” said Tarun Pathak, research director, Counterpoint Research. It’s not just production that has been on the rise, local value addition has also reached an all-time high. “Local value addition in India currently stands at an average of more than 15%, compared to the low single digits eight years ago,” Pathak added. “The government now intends to capitalise on its various schemes to make India a ‘semiconductor manufacturing and export hub’. Going forward, we may see increasing production, especially for <a href="https://www.counterpointresearch.com/global-smartphone-market-q1-2023-infographic/">smartphones</a>, as India gears to bridge the urban-rural digital divide and also become a mobile phone exporting powerhouse,” Pathak said. <cmsannotation type="cmsannotation" annotationid="Apple accounts for a huge chunk" comment="subhead" text="Apple accounts for a huge chunk">Apple accounts for a huge chunk</cmsannotation> According to a report by ET, Apple accounted for 25% of the total value of domestically manufactured smartphones in 2022, more than double the 12% in 2021. While Apple’s production has increased by 65% year-on-year in 2022, its value has increased by 162%. One of the reasons for this could be the increased sales of premium <keyword id="57315" type="General" weightage="50" keywordseo="iphones" source="Orion">iPhones</keyword>. <cmsannotation type="cmsannotation" annotationid="India records 23% CAGR" comment="subhead" text="India records 23% CAGR">India records 23% CAGR</cmsannotation> India has reportedly recorded a compounded annual growth rate (CAGR) of 23%. Huge internal demand, increasing digital literacy and government’s push are reported to be the top reasons for this growth. The Indian government has introduced schemes such as Phased Manufacturing Program (PMP), Make in India, <keyword id="8870884" type="General" weightage="50" keywordseo="production-linked-incentive" source="Orion">Production Linked Incentive</keyword> (PLI) and Atmanirbhar Bharat to increase local manufacturing. SEE ALSO: <a href="https://www.businessinsider.in/tech/gadgets/news/with-smartwatches-leading-the-pack-indian-wearables-market-grows-over-50-in-the-first-half-of-2023/articleshow/102638102.cms">With smartwatches leading the pack, Indian wearables market grows over 50% in the first half of 2023</a> <a href="https://www.businessinsider.in/finance/news/cash-card-or-talk-rbi-bats-for-conversational-upi-increased-offline-payments/articleshow/102599474.cms">UPI joins the AI bandwagon, offline payments get a push</a> <a href="https://www.businessinsider.in/business/auto/news/auto-sales-slip-5-percent-in-july-companies-build-up-inventory-ahead-of-the-festive-season/articleshow/102494498.cms">As auto sales slip in July, dealers pin hopes on upcoming festive fervour</a>

India crosses the 2 billion mark in its journey to become a smartphone manufacturing powerhouse

<keyword id="8605129" type="General" weightage="20" keywordseo="Electronics-export" source="Orion">Electronics export</keyword> from <keyword id="3658" type="General" weightage="100" keywordseo="india" source="Orion">India</keyword> is expected to cross Rs 1.28 lakh crore in the next financial year, Minister of State for Electronics and IT Rajeev <keyword id="79017" type="General" weightage="50" keywordseo="chandrasekhar" source="Orion">Chandrasekhar</keyword> has said. The minister, in an interview with PTI, said the government is now going to broaden and widen the electronics manufacturing ecosystem with a new production-linked incentive scheme for hearable-wearable, IT hardware and component makers. "Electronics manufacturing as a whole, we see next year that we will at least do exports worth Rs 1.28 lakh crore. I have already said that we will see mobile phone exports reaching Rs 1 lakh crore in 2023-24," Chandrasekhar said. There has been a focus on mobile phones because it is the fastest-growing segment in electronics across the world, he added. "Value addition in manufacturing is a function of scale. First, you need to hit the scale. The component industry is the one which does value addition. Components will not come if the scale of manufacturing is not there. The next stage of our PLI is to get components PLI, hearable-wearable PLI and the IT server PLI," the minister said. The government will do 100 per cent hand-holding of component players to boost the local ecosystem, he noted. Electronics component makers' body ELCINA has requested the government to allocate USD 10 billion (about Rs 80,000 crore) for 8 years to boost manufacturing of electronic components and key modules other than semiconductors. It has sought a four-year extension to the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS), with an increased outlay of Rs 16,000 crore in the <keyword id="6360189" type="General" weightage="80" keywordseo="union-budget" source="Orion">Union Budget</keyword> for 2023-24. According to ELCINA, the upgraded PLI will facilitate investments of around Rs 64,000 crore with a targeted output of USD 24 billion (about Rs 1.95 lakh crore) for all components other than semiconductors. The industry body has also sought reinstatement of income tax relief for the investment made in research and development. It has also asked for a PLI scheme with a focus on domestic electronics manufacturing services companies. <keyword id="292934" type="General" weightage="80" keywordseo="india-electronics" source="Orion">India Electronics</keyword> and Semiconductor Association (IESA) has requested the government to convert the PLI scheme into a design-led manufacturing scheme and impose an import duty of 10 per cent on any imported electronics equipment and assembled printed circuit board (PCB) to boost local manufacturing.

Electronics export from India to cross ₹1.28 lakh crore next fiscal: MoS IT

New Delhi, Apr 1 () The government on Wednesday notified three schemes involving total incentives of around Rs 48,000 crore to boost local electronics manufacturing and create 20 lakh direct and indirect jobs by 2025. The government notified production linked incentive scheme (PLI) for large scale electronics manufacturing, the scheme for promotion of manufacturing of electronic components and semiconductors (SPECS), and the modified electronics manufacturing clusters (EMC 2.0) scheme. It expects to attract Rs 1 lakh crore investment in the sector and generate manufacturing revenue potential of Rs 10 lakh crore by 2025. "The Production Linked Incentive Scheme (PLI) for Large Scale Electronics Manufacturing proposes a financial incentive to boost domestic manufacturing and attract large investments in the electronics value chain including electronic components and semiconductor packaging," the notification said. Under the scheme, electronic manufacturing companies will get an incentive of 4 to 6 per cent on incremental sales (over base year) of goods manufactured in India and covered under target segments, to eligible companies over a period of next 5 years. "The scheme shall only be applicable for target segments namely mobile phones and specified electronic components," the notification said. The production of mobile phones in the country has surged eight-times in the last four years from around Rs 18,900 crore in 2014-15 to Rs 1.7 lakh crore in 2018-19 and the domestic demand is almost completely being met out of domestic production. The SPECS notified for manufacturing of electronics components and semiconductors has a budget outlay of Rs 3,285 crore spread over a period of eight years. The notified EMC 2.0 has a total incentive outlay of Rs 3,762.25 crore spread over a period of 8 years with an objective to create 10 lakh direct and indirect jobs under the scheme. The government estimates that PLI scheme, domestic value addition for mobile phones is expected to rise to 35-40 per cent by 2025 from the current level of 20-25 per cent and generate additional 8 lakh jobs, both direct and indirect. The government estimates that push for manufacturing of electronics components and electronic chips will create around 6 lakh direct and indirect jobs. The EMC 2.0 scheme will provide financial assistance up to 50 per cent of the project cost subject to a ceiling of Rs 70 crore per 100 acres of land for setting up of Electronics Manufacturing Cluster projects. Electronic manufacturing clusters to be set up under the scheme will be spread in an area of 200 acres across India and 100 acres in North East part of the country. PRS PRS MRMR

Govt notifies schemes with Rs 48,000 cr incentive to boost electronics production

New Delhi, Mar 21 () The Union Cabinet has cleared three schemes involving a total incentive of around Rs 48,000 crore to boost electronics manufacturing in the country, Telecom and IT Minister Ravi Shankar Prasad said on Saturday.The government is expecting to generate manufacturing revenue potential of Rs 10 lakh crore and create direct and indirect jobs for 20 lakh people by 2025 through these schemes, he said.Besides this, the Cabinet in its meeting held on Friday also approved incentives for medical devices to reduce dependency on import of electronic products for medical care in the country. "Two long-term policy decisions have been taken to make India a big hub of manufacturing. First in case of electronics, second in case of pharma and also medical devices. Cabinet has approved production linked-incentive for electronics companies. We will give Rs 40,995 crore in the coming five years for production linked-incentive," Prasad said.Under the scheme, electronic manufacturing companies will get an incentive of 4 to 6 per cent on incremental sales (over base year) of goods manufactured in India and covered under target segments, to eligible companies over a period of next 5 years.Industry body India Cellular and Electronics Association said that the PLI scheme is of global scale which not only spur manufacturing but more importantly exports of mobile handsets at a global scale. "The National Policy for Electronics 2019 envisions India to reach a mobile phone production of USD 190 billion by 2025, of which USD 110 billion would be exported. PLI is the policy intervention to support the ambition to build the electronics sector, where the main focus remains on manufacturing of mobile phones and components," ICEA Chairman Pankaj Mohindroo said.The Cabinet approved scheme for promotion of manufacturing of electronics components and semiconductors with a budget outlay of Rs 3,285 crore spread over a period of 8 years. It also approved revised version for electronics manufacturing clusters with a total incentive outlay of Rs 3,762.25 crore spread over a period of 8 years with an objective to create 10 lakh direct and indirect jobs under the scheme. "Because of these three schemes, we hope to generate manufacturing revenue potential of Rs 10 lakh crore by 2025 and generate direct and indirect jobs for 20 lakh people," Prasad said. The government estimates that PLI scheme, domestic value addition for mobile phones is expected to rise to 35-40 per cent by 2025 from the current level of 20-25 per cent and generate additional 8 lakh jobs, both direct and indirect."This incentive is linked to production and investment in India. We also make 3-4 Indian companies also champion companies," Prasad said.The government estimates that push for manufacturing of electronics components and electronic chips with create around 6 lakh direct and indirect jobs."If India has to progress in the field of electronics then it should also become a centre for component manufacturing for electronics, telecommunications, consumer electronic, medical electronics, strategic electronics etc. This is investment in the downstream value chain. We will give 25 per cent incentive on capital expenditure," Prasad said.The EMC 2.0 scheme will provide financial assistance upto 50 per cent of the project cost subject to a ceiling of Rs 70 crore per 100 acres of land for setting up of Electronics Manufacturing Cluster projects. "Electronic manufacturing clusters will be spread in an area of 200 acres across India and 100 acres in North East part of the country. Whoever will make investment of Rs 300 crore under this scheme will be given incentives," Prasad said. The minister said that the production of mobile phones in the country has gone up 8 times in last 4 years from around Rs 18,900 crore in 2014-15 to Rs 1.7 lakh crore in 2018-19 and the domestic demand is almost completely being met out of domestic production. "It is extremely critical to keep it (implementation of schemes) simple. Quick disbursement of money on the basis of one or at-most two parameters and ensure annual signoff with no retrospective claims on industry on incentives disbursed," MAIT President Nitin Kunkolienker said. PRS MKJ

Cabinet approves schemes to boost electronics mfg with Rs 48,000 cr incentives

<ul><li>India poised to have 1 billion smartphone users by 2026 and will be the second-largest smartphone manufacturer in the next five years.</li><li>India to catch on to the <keyword id="13228644" type="General" weightage="20" keywordseo="global-Non-fungible-Tokens" source="Orion">global Non-fungible Tokens</keyword> (NFTs) revolution with favourable regulations.</li><li>The AI market to grow at a CAGR of 20.2 percent globally to reach US$7.8 billion by 2025; AI to have a promising future in India.</li></ul> Favourable policies, convenience-driven mindset, and evolution of the new normal have brought in a renewed focus on tech adoption. Smartphones now act as a catalyst for digital penetration across the tier-2 and 3 markets in India. The India edition of Deloitte’s 2022 Global TMT (Technology, Media, and Entertainment, Telecom) predictions indicates that digital and mobile are the key enablers of the future of technology. This edition captures the latest trends in the Indian TMT space that are driven by the economic and societal shifts caused by the global pandemic. These trends are poised to result in a better-connected ecosystem of multiple digital devices that can meet the world's ever-increasing need for faster connectivity, and more chips and entertainment options. Moreover, an evolving marketplace for NFT, increasing diversity in talent and participation of women in the tech industry, and rising popularity of AI and app-centric approach to promote mental health and wellness indicate enhanced digital maturity for businesses. Technology sector prediction - The urgency to address semiconductor chips shortage The global shortage of semiconductor chips has affected the manufacturing industries across the world. As demand soars, supply is likely to be constrained in the near term, but gradually ease up in 2023. With an increase in supply and normalisation of demand, and the specific initiatives muted by GOI, India can play on the strength of its large and thriving domestic market to form a basis for setting up the domestic semiconductor and electronics manufacturing industries in the next three-five years. “As the ecosystem matures in the medium to long term, we expect India to emerge as a strong regional hub in semiconductor and electronics manufacturing”, said P. N. Sudarshan, Partner and TMT Industry Leader, Deloitte India. He added, “The government’s recent announcement on the Production Linked Incentive (PLI) scheme for the semiconductor and electronics manufacturing industries has the potential to create an end-to-end ecosystem for manufacturing electronic products. We expect the broader shift to digital to continue in 2022 and drive the industry growth in the future.” Telecom sector prediction: 1 billion smartphone users by 2026 In 2021, the Indian telecom sector has undergone major policy reforms to reset growth and revive the health of the operators. The total cumulative shipments of smartphones in the country are expected to reach 1.7 billion units from 2022 to 2026, creating a market of about US$250 billion. According to Deloitte’s analysis, smartphone demand in India will increase at a CAGR of 6 per cent in the rural market and at a CAGR OF 2.5 per cent in the urban market to reach a cumulative number of about 400 million units being sold in 2026. This is largely propelled by demand for internet services in the rural market with the adoption of E-learning, Fintech and E-health platforms. Internet enabled devices in the rural market will also get a push with the government’s plan to fiberize all villages by 2025 under the BharatNet program. 5G devices will alone contribute 80 percent (about 310 million devices) to smartphone demand by 2026. Furthermore, the recently announced incentive package of US$10 billion to drive semiconductor manufacturing in India and the PLI schemes will encourage handset manufacturing in India to service the second-largest smartphone market in the next five years. Peeyush Vaish, Partner and Telecom Sector Leader, Deloitte India, said “India will have 1 billion smartphone users by 2026. This growth will result in over 75 percent of the subscribers using smartphones by 2026 from a sub- seventy percent as on date. 5G enabled devices will contribute 80 percent to the devices being sold in the year 2026 and Indian consumers will purchase 840 million 5G smartphones over the next 5 years valued at US$130 billion. In addition, 5G will fuel an incremental sale of 135 million smartphone units over the next 5 years.” Media sector prediction: The Indian streaming industry to evolve dramatically Greater adoption by audiences, the popularity of international content (such as Korean, Israeli, or Spanish) in India, and the ability to attract a wider audience through subtitles and dubbed content, have broken previously held views on the characteristics of the Indian market. These trends have forced many streaming companies to revise their original strategies. Pricing for streaming services will remain competitive as service providers attempt to stabilise and consolidate their customer base. However, in a rapidly evolving market, streaming players would rather focus on customer acquisition instead of customer churn. As prices stabilise and content libraries become nuanced and structured, the focus will shift to the minimisation of churn. Jehil Thakkar, Partner, Media and Entertainment Sector Leader, Deloitte India, said “Evolving consumer behaviour in view of the pandemic has increased digital content consumption in India. Audiences are experimenting with genres and languages with regional content breaking out of its traditional boundaries. Fierce competition is likely to persist in the short-to-medium term with more than 40 service providers in the fray.” This growth will be driven by heavy investment in original content, pricing innovations, low data costs, and the rise of short-form content. However, this progression from the early to mass stage might come at a cost to the broader media industry as subscribers, especially in tier-1 and tier-2 cities, may switch to more streaming content from traditional linear TV. We, however, do not expect India to cut the cord. Gaming and commerce are important elements contributing to attract, retain and amplify consumer stickiness as the battle within the evolving digital world continues. Other highlights in the Deloitte “TMT Predictions 2022” report India all set to catch on to the global NFT revolution; entertainment and sports NFTs will disrupt the industry in India: Deloitte Global predicts that NFTs for sports media will generate more than US$2 billion in transactions in 2022, about double the figure for 2021. Given the global trends and the government of India’s pending policy/regulatory framework in this area, it is a matter of time before NFT-based market for movies and sports memorabilia becomes a reality in India. The future of AI in India: More market players are realising AI’s importance, including its ability to provide competitive advantage and sculpt the future of work. In 2022, we expect to see India’s AI priorities shift towards cost efficiencies and employee productivity. Mental health becomes a priority with increasing app penetration: Given the challenges related to awareness, access, and capacity, technology can play a significant role in building scalable solutions that can help the population at large. About **36 percent of the Indian millennials have a fitness app installed on their phones and ~45 percent think leading a healthy life is essential. Floating Solar Photovoltaics (FSPVs) as a means for scaling solar PV deployment: FSPVs is expected to play an important role in paving the path for India’s energy sufficiency given the natural advantage of a vast coastline. With reduced crude prices and improved designs, Deloitte India predicts a significant rise taking place as both central and state government agencies might announce more floating solar projects. Deloitte India further estimates that the FSPV sector in India has a high potential to become self-sustainable largely due to the benefit of economies of scale as and when the tariff rate reduces over the next few years.

NFTs for sports media will generate more than $2 billion in transactions in 2022, about double the figure for 2021: Deloitte report

New Delhi, June 11 (IANS) With a three-pronged strategy (restart, restore and resurgence), India can achieve $100 billion in mobile phones and nearly $40 billion in component exports by 2025, a new report said on Thursday. The strategy document titled "Mobile Manufacturing in a post-COVID-19 World" by industry body India Cellular and Electronics Association (ICEA) and consultancy major EY, offers a roadmap for the Indian industry to become a global supplier of mobile phones in a world where two countries -- China and Vietnam -- and five global companies dominate over 80 per cent of the world's export market. Nearly 198 countries import mobile phones, and till recently, only two countries -- China and Vietnam -- were among the exporters. India joined the ranks as a third with a modest $3 billion exports in 2019-20. It now aims to target the number two spot. "The mobile manufacturing and components sector is ready to lead India's post COVID-19 exit strategy. Production has restarted. We hope to hit 100% production by August," Pankaj Mohindroo, Chairman, ICEA, told reporters in a video call. India earlier this month launched three major schemes to boost manufacture of electronics in the country -- Production Linked Incentive Scheme (PLI) for large-scale electronics manufacturing, Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS), and Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme. The three schemes would entail an outlay of about Rs 50,000 crore. "As the PLI scheme kicks in, we plan to ramp up global exports from India. There isn't a moment left to waste," Mohindroo added. He said that the Indian mobile phone manufacturing industry is moving forward harmoniously. "There is no such this as a domestic lobby and an international lobby here...We cannot work only on the supposedly big Indian market. We will have to export," he said, adding that in the next four to five years the big global companies will be manufacturing in India for their global exports. ICEA represents mobile and component manufacturers such as Apple, Motorola, Xiaomi, Nokia, Foxconn, Wistron, Flextronics, Lava, Vivo and others. The plan prepared by ICEA and EY which aims at transforming mobile manufacturing and components into India's largest export within the next 3-4 years, aligns closely with the government's National Policy on Electronics (NPE-2019). "The introduction of the incentive schemes like PLI, SPECS and EMC will bring resurgence in the manufacturing environment and create a competitive global ecosystem for India to capture the global market share of mobile phones, parts and accessories," said Bipin Sapra, Indirect Tax Partner Telecom sector, EY India. The report also pointed out areas of improvement, such as the need to shift large-scale global value chains, reduce cost of inputs and the need to increase competitiveness by building a low-cost domestic ecosystem and seeking partnership with states to address India's disabilities. From just two mobile phone factories in 2014, India now has become the second largest mobile phone producer in the world, according to the IT Ministry. --IANS gb/na

India mobile handset industry can reach $100bn in exports by 2025: ICEA-EY

The department for promotion of industry and internal trade (<keyword id="19952901" type="General" weightage="20" keywordseo="DPIIT" source="keywords" meta.keywordsubtype="org" meta.entityname="DPIIT" meta.hostid="261" meta.entityid="DPIIT">DPIIT</keyword>) on Monday asked <keyword id="19957196" type="General" weightage="20" keywordseo="white-goods" source="keywords">white goods</keyword> manufacturers to participate in large numbers to avail fiscal benefits under the <keyword id="19952889" type="General" weightage="20" keywordseo="production-linked-incentive" source="keywords">production linked incentive</keyword> scheme for the sector as the response has been muted so far. Additional Secretary in the DPIIT Rajeev Singh Thakur said that the department has again reopened the application window for the PLI (production linked incentive) scheme for white goods (<keyword id="20360726" type="General" weightage="20" keywordseo="ACs" source="keywords">ACs</keyword> and LED lights). The application window is open from July 15 to October 12. "In the PLI in white goods scheme, somehow the response has been muted. ...Probably due to various reasons not sufficient response has come. So I request (the industry) to have a look and probably this time, you can consider (applying)," Thakur said at the CII Consumer Electronics and Durables Summit 2024 here. So far, 66 applicants with committed investment of Rs 6,962 crore have been selected as beneficiaries under the PLI scheme. The Union Cabinet had given approval for the PLI scheme for white goods for <keyword id="19914449" type="General" weightage="20" keywordseo="manufacturing" source="keywords">manufacturing</keyword> of components and sub-assemblies of Air Conditioners (ACs) and LED lights on April 7, 2021. The scheme is to be implemented over a seven-year period, from 2021-22 to 2028-29, and has an outlay of Rs 6,238 crore. He added that the department can hold talks with the industry separately on issues like quality control orders and logistics. Thakur told the industry that the time is right to increase investments into the country as the government has enhanced its capex and taken steps to promote <keyword id="19996629" type="General" weightage="20" keywordseo="ease-of-doing-business" source="keywords">ease of doing business</keyword>. The public capex in the last 10 years is growing at a fast pace in areas like highways, expressway, ports, airports and railways, but the commensurate response of the private sector "somehow is not up to the expectation", he said. Earlier speaking at the event, DPIIT Secretary Amardeep Singh Bhatia said that a lot of steps have been taken to promote ease of doing business, cutting down compliance burden and decriminalisation of minor offences. The government has also recently approved 12 industrial townships and the industry can look at investing there. He added that capital availability is not an issue now and the government has also provided protection to the industry from predatory imports. Schemes like PLI and semiconductor mission have been rolled out to promote manufacturing and "now we want the industry" to ensure that they have necessary collaborations in place for technology and investments. The industry should do collaborations not only to target the domestic market but also become part of global value chains. "That is an expectation we are having from the entire industry and I think industry will rise to meet these expectations... We have a huge demographic dividend and the industry should take advantage of this otherwise we will miss it," Bhatia added. He also said that there is no paucity of adequate skilled labour in the country and logistics costs too are coming down. On logistics, he cited examples of Amazon and Flipkart selling goods in the remotest part of the country. "I don't think industry should look at the current domestic demand only for collaborations. They should look at the future and export market also in addition to the domestic market," he said, adding expenditure on research and development is "abysmally" low and that needs to be enhanced. 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Govt asks white goods industry to apply for manufacturing sops in large numbers

<ul><li>Over 22 firms including Apple, Samsung, Lava line up with proposals to manufacture mobile phones in India</li><li>Government's production-linked incentive (PLI) scheme for <keyword id="2922097" type="PERSON" weightage="20" keywordseo="mobile-phone-manufacturing">mobile phone manufacturing</keyword> expected to create around 12 lakh jobs</li><li>There is no price limit for Indian companies under the scheme.</li></ul> As many as 22 domestic and international firms, including iPhone maker Apple's contract manufacturers as well as Samsung, Lava, Dixon and so forth, have lined up with proposals for mobile phones production worth Rs 11 lakh crore over the next five years, Union Telecom and IT Minister <keyword id="6354886" type="PERSON" weightage="20" keywordseo="Ravi-Shankar-Prasad">Ravi Shankar Prasad</keyword> said on Saturday. The minister said these proposals under the government's Rs 41,000-crore production-linked incentive (PLI) scheme for mobile phone manufacturing are expected to create around 12 lakh jobs, 3 lakh direct and 9 lakh indirect employment opportunities, in the country. "There will be huge (mobile phone) production of around Rs 11 lakh crore, huge export of around Rs 7 lakh crore and great employment opportunity for 3 lakh direct and 9 lakh indirect people. I personally thank all the companies that have applied," Prasad told reporters. He said that a total of 22 companies have filed applications under the PLI scheme from various countries including Taiwan, South Korea, Germany, Austria, etc. "The benchmark for international companies was that they make mobile phones priced at or above Rs 15,000. International companies that have applied are Samsung, Foxconn Hon Hai, Rising Star, Wistron and Pegatron," Prasad said. Foxconn Hon Hai, Wistron and Pegatron are contract manufacturers for Apple iPhones. There is no price limit for Indian companies under the scheme. In terms of revenue, Apple accounts for 37 per cent and Samsung 22 per cent for global sales of mobile phones and the PLI scheme is expected to increase their manufacturing base manifold in the country, an official statement issued by the Ministry of Electronics and IT (Meity) said. The minister further said these companies will make thousands of crores investments based on the approval of their proposal. Prasad said Indian companies, including Lava, Dixon Technologies, Bhagwati (Micromax), Padget Electronics, Sojo Manufacturing Services and Optiemus Electronics, have applied under the scheme and 10 companies have filed applications under the Specified Electronic Components Segment. The companies that have applied for components production of around Rs 45,000 crore include AT&amp;S, Ascent Circuits, Visicon, Walsin, Sahasra, Vitesco and Neolync. There were no applications from Chinese companies under the scheme. The minister said India is not averse to investment from any country but companies will have to follow rules related to security clearance, etc. The government notified production linked incentive scheme for large scale electronics manufacturing, the scheme for promotion of manufacturing of electronic components and semiconductors, and the modified electronics manufacturing clusters (EMC 2.0) scheme. The government expects to attract Rs 1 lakh crore investment in the sector and sees a target manufacturing revenue potential of Rs 10 lakh crore by 2025. The fresh proposals have exceeded the government's manufacturing revenue target but the final outcome will depend on the decision of the screening committee that will select projects eligible for incentives.

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