Electronic Industries Association of India Cluster Vision

Background and Key Features

The classical definition of a Cluster is “Geographical concentration of units producing similar products and facing similar threats and opportunities”.

The idea of establishing a model cluster for electronics manufacturing has been proposed by the industry and supported by Department of Electronics & Information Technology to provide a supportive eco-system for encouraging investments and growth in this industry.

• Demand growth for Information & Communication Technology & Electronics (ICTE) Hardware products has far outstripped the growth in domestic production resulting in unparalleled growth in imports.
• Presently about 60% of the demand is being met through imports.
• As per government and industry reports, import of electronics is expected to surpass oil imports before 2020!

The demand supply gap is huge and in 2009, demand was at US$ 45 bn., against production of US$ 20 bn. Demand is estimated to have crossed US$ 75 bn. in 2011-12 against estimated output of US$ 35 bn. This is not a happy situation for our country as it exposes us to serious strategic disadvantages and keeps us dependent on technology and our essential needs on foreign countries.

India’s Priority If India achieves 25-30% annual growth in electronics production over the 12th Plan period: It will create millions of direct and indirect employment opportunities Contribute to meeting inclusive growth objectives Reduce Foreign Exchange outgo, and Add to government revenues while improving the quality of life and empowerment of our people. The growth in GDP is directly correlated to ICTE penetration as it is recognised as a meta-resource impacting all sectors, an enabler for technological advancement and enhancer of competitiveness.

Way to succeed All countries which have successfully set up a strong ICTE manufacturing industry and captured global markets have provided: Good physical infrastructure User friendly policy framework and approval mechanisms, Low cost of funds, Reasonable tax rates and a supportive government. ICTE hardware is the first sector to face elimination of import duty on account of WTO-ITA-I and FTAs leaving no room for any inefficiency.