Future of Electronics & Defence Manufacturing in India

Date:   Tuesday , December 08, 2015

India has the right elements to build an excellent manufacturing eco-system and \'Make in India\' initiative will act as a catalyst to change the face of our nation being a manufacturing economy. India has all the potential to emerge as the next Manufacturing hub in the world. Govt\'s \'Make in India\' initiative is projected to make India a preferred manufacturing destination encompassing 25 sectors that includes ESDM, automobiles, chemicals, IT, aviation,design manufacturing, renewable energy, and several other sectors that rely heavily on electronics, expanding the opportunities to create employment, purchasing power, spending and supply. We believe the success of the MAKE IN INDIA program will create an \"Orbit Changing Atmosphere\" which will be conducive for major breakthroughs in design-led manufacturing. The government has been pushing for investments from all over globe and we\'ve been getting positive responses from market leaders across industry segments.

The Indian Government, through the Department of Electronics and Information Technology (DeitY), has instituted a number of forward-looking policies to foster the growth of the Indian electronics ecosystem. Such policies are aimed at the holistic development of the ESDM industry by offering specific incentives for the development of each element in the value chain. Since the government has been encouraging companies to manufacture their products in India and we can already see a lot of traction happening under \'Make in India\' initiative. Companies like Foxconn, Sony, Hitachi, Huawei and several other mobile manufacturing companies have committed to develop and manufacture their products in the country. According to a study by Federation of Indian Chambers of Commerce and Industry (FICCI), Embassy of India and Ernst & Young, German companies are going to invest in Indian High - Tech market.

India\'s strength in design is well-acknowledged around the world. However, we have been struggling in terms of IP creation. As long as our capabilities comprise mainly of low value addition activities, we will not be able to scale the heights that we aim for as a nation. Investments in R&D are crucial to enrich our intellectual capital.

Indigenisation of Defence manufacturing

There is the added need to develop innovative products that meet the exacting standards and compliance benchmarks of the aerospace and defence industry. The Indian aerospace, defence and internal security domains are growing rapidly but are still predominantly reliant on imports. Though complete self-reliance may still seems like a distant dream, we must aim our arrows toward that goal and continue to work relentlessly towards the cause. However, no industry can grow unless it can forge global partnerships and tap into the worldwide market. Self-sufficiency depends as much on Make in India as it does on strategic international alliances, FDI, transfer of technologies, and more As we strive together to realize our dream of becoming the manufacturing hub for the world, it is extremely important to look at innovative solutions that help us differentiate ourselves and address the complex problems of the modern world.

Reports state that approximately 60 percent of foreign defence companies believe India to be an attractive investment destination. However, to convert this interest into actual business, there has to be a favourable manufacturing ecosystem for defence production. A public private partnership (PPP) is vital to ensure that this ecosystem becomes a viable concept. An optimum step forward in this regard would be the establishment of a defence industrial complex (DIC), which would bring together large and medium industries and defence public sector units (PSUs). Not only can the DIC boost indigenous manufacturing but it can also help create an ecosystem to strengthen the capabilities of the Indian aerospace and defence industry. A varied terrain, long coastline, porous borders, and others, make India a challenge with regard to internal security. The need to protect our internal environment is recurrently brought into sharp focus by various threats of varying magnitude on our soil. The increased budgetary allocation toward internal security is a testament to the Indian government\'s urgency for a solution to tackle this problem. The government has already allocated Rs.2,290 billion for defence services. Besides, some of the key foreign investors like Airbus, Boeing India, Rafael, Raytheon and others are already keen on investing in Indian Defence manufacturing.

Role of start-ups
Self-reliance in defence and aerospace is a vision we all want to realize sooner rather than later. An important component of this transformation would definitely be empowering start-ups to play a greater role. Start-ups are uniquely positioned to drive innovation and deliver path-breaking products. Start-ups also have the advantage of being able to focus on niche, cutting-edge technologies while also managing to remain extremely nimble. However, start-ups can flourish only if they are provided the right support for incubation, going to the market and scaling their ideas into sustainable businesses.

It is our firm belief that the country\'s ESDM sector is progressing on the right direction and I am highly optimistic about a robust ESDM sector blossoming in the years to come.