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Indian Hardware Manufacturing Sector- Face of Economy

Indian Manufacturing IntroAiming to achieve a GDP of $5 Trillion by 2025, has already set India in a league of its own. Though not a small feat to achieve by any chance, the dream is not impossible to aim for in real-time.

With a huge workforce available at its disposal and the ever-increasing population, India has marked its presence globally as the upcoming market with lots of potentials. As the government emphasized many aspects of speeding up this growth arc, the manufacturing sector has come up as the deciding factor in overcoming the hurdle of self-sufficiency.

The government’s various initiatives to integrate people into the digital world are slowly coming to fruition as India is slowly becoming a large base of mobile users at a rapid pace. But such growth comes with more imports and higher prices of electronic goods due to a lack of the country’s underdeveloped manufacturing industry.

One of the most critical industries that can change the tides of India’s GDP is the Growth of India’s Hardware Manufacturing Sector. Also known as the electronics manufacturing industry, India is at a pinnacle of undergoing a massive overhaul in the manufacturing sector as the government has underlaid various detailed plans to restructure this sector to meet global demands.

The Growth of India’s Hardware Manufacturing Sector is the pivotal point to establish India as the potential manufacturing powerhouse that has yet to realize its promise.

Overview of India’s Current Manufacturing Scenario

Till now to meet the growing demand for electronic goods, India heavily relied on imports of electronic parts and machines in bulk from various neighboring countries, specifically China. It might come as a surprise that the electronics goods imports bill is second only to India’s oil import bill. This led to the degradation of India’s indigenous electronic manufacturing at a massive scale.

Electronics Trade 

Manufacturing unitOut of the total electronics demand generated in India for the last few decades, were getting fulfilled by 50 percent imports, whereas the total local electronics production that got exported amount to only 16 percent. To reverse this major flaw in the import-export of electronics goods, the government has set some security measures to limit these heavy imports as well as increasing the capacity of India’s local manufacturing with different schemes.

Though slow-paced, Growth in India’s Hardware Manufacturing Sector is gaining traction as domestic production has started outpacing growth in imports.

Despite these measures, India still lags in the production of semiconductors and integrated circuits that are a major product getting imported. Since India lacks the required ecosystem as well as the technical know-how to produce them, the country’s semiconductor industry is still at its nascent stages.

Factors Required for the Growth of India’s Hardware Manufacturing Sector

To spur the Growth of India’s Hardware Manufacturing Sector, we should account for several factors that might boost the production of electronics goods as well as increase the efficiency of supply chain.

Growth of ESDM

For a long time, India’s electronic goods demand had been fulfilled by the cost-effective prices of electronics parts that got imported from China, due to which the domestic Electronic System Design and Manufacturing (ESDM) sector has not evolved as it should have and is still lacking in many areas.

Therefore, the Growth of India’s Hardware Manufacturing Sector largely depends on ESDM that includes hardware components to a host of sectors, like consumer electronics, information technology and medical electronics, and many more.

Decreasing Reliance on China’s Huge Supply Chain

Another factor hindering the Growth of India’s Hardware Manufacturing Sector is the heavy reliance on the electronics supply chain the country had from China.

The fact becomes more apparent during the pandemic, as imports businesses laid standstill during severe lockdown conditions. Surprisingly, India hasn’t been focusing on the manufacturing of electronics products.

Growing Telecom Sector 

nokia factoryWith a strong surge of digital drive happening across the country, India has now become the second-largest mobile subscriber base in the world. This achievement can be primarily attributed to the easy availability of affordable phones, and low data charges.

This also led to a growth of robust rise in the import of telecom instruments as well as mobile accessories. The Growth of India’s Hardware Manufacturing Sector can thus be heavily dependent on the rise of local mobile phones companies in India that will compete with the global brands.

Government’s Policy and Initiatives 

The government of India has been greatly pushing the boundaries of India’s electronics hardware sector as they have continuously implemented a wide range of policies and initiatives to boost the Growth of India’s Hardware Manufacturing Sector.

The government is currently working on various foreign collaborations to set up electronics manufacturing units all across the country under the PLI scheme whether it is for mobile phone manufacturing or electronic parts like digital displays, semiconductors.

Challenges Ahead

Though India is still in the development stages of manufacturing, the government must ensure to provide high investment in the R&D sector of electronics goods.

Following China’s example, India will need to achieve self-reliance in advanced electronics sectors to gain good results in electronics goods manufacturing.

Future investments in semiconductors, electronic parts and ICs will be the key driver to ensure steady Growth in India’s Hardware Manufacturing Sector.


Aishwarya Saxena

A book geek, with creative mind, an electronics degree, and zealous for writing.Creativity is the one thing in her opinion which drove her to enter into editing field. Allured towards south Indian cuisine and culture, love to discover new cultures and their customs. Relishes in discovering new music genres.

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