Amid the slowdown in the Indian economy, certain sectors have been performing well. One of the bright spots has been the electronic sector. As per the annual report published by Reserve Bank of India on 29th August, total production of electronic goods in value terms more than doubled from $31.2 billion in FY15 to $65.5 billion in FY19. This was mainly driven by the rise in production of Mobile Phones. India has become the 2nd largest producer of mobile phones, replacing Vietnam.
India’s electronics imports touched a record $55.6 billion in FY19, against $51.5 billion a year before, and remained the largest driver of its trade deficit after oil, showed the latest official data. However, what offered policymakers some comfort was that electronics exports jumped as much as 39% to a record $8.9 billion last fiscal, against 12.3% in the previous year.
Indian electronic good exports stood as high as $ 8.85 billion as of 2012-13. Since then it has been declining. This was mainly driven by the the damaging impact of the October 2014 shutdown of Nokia’s manufacturing plant in Tamil Nadu. However, the Indian economy has been able to offset the loss in the recent years. One of the reason for the boost in electronic export is the ongoing trade war between China and US.
Moreover, in the last few years, the government has launched a slew of schemes to boost local manufacturing of electronic goods. These include Phased Manufacturing Programme for mobile handsets and related sub-assemblies/components manufacturing, National Policy on Electronics 2019, Electronics Manufacturing Clusters scheme and Modified Special Incentive Package Scheme. Some countervailing duties were also announced to discourage imports of electronic goods.
IPD hopes that electronic exports continue the growth trajectory in future days as well.