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Indian Electronics Industry Analysis

August, 2013

Electronics goods production in India is estimated to reach US$ 32.7 billion in FY13. The production expanded at a compound annual growth rate (CAGR) of 16.8 per cent during FY07-12. Production of communication and broadcasting (C&B) equipment is expected to expand at a CAGR of 33.9 per cent over FY 07-13.

Indian electronics market is expected to grow to US$ 400 billion by 2020 from US$ 69.6 billion currently. The market is expected to expand at a CAGR of 24.4 per cent during 2009-20.

The sector has attracted strong investments in the form of mergers and acquisitions (M&A) and other foreign direct investment (FDI) inflows. Companies are set to augment investments in production, distribution and research and development (R&D) in the next few years.

The Government of India (GOI) has permitted 100 per cent FDI in the electronics hardware manufacturing sector under the automatic route.

The Government has also launched Export Promotion Capital Goods (EPCG) and Electronic Hardware Technology Park (EHTP) schemes to allow import of electronic capital goods without paying any custom duty and provide benefits such as duty waviers and tax incentives, to companies which replace certain imports with local manufacturing.

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