Ministry of Electronics & Information Technology (MeitY) erstwhile Department of Electronics & Information Technology (DeitY) has been setup with a mission for the e-Development of India through multi-faceted strategy of e-Infrastructure creation to facilitate and promote e-Governance for empowering citizens, promoting the inclusive and sustainable growth of the Electronics, IT & ITeS industries, enhancing India’s role in Internet Governance, adopting a multi-pronged approach that includes development of human resources, promoting R&D and innovation, enhancing efficiency through digital services and ensuring a secure cyber space.
In order to get a knick of what the Ministry has planned for empowering the country’s electronics sector; LED World met Deepak Sharma, Director, MeitY. Mr. Sharma, who holds a Masters Degree in Engineering in Electronics & Communication from Delhi College of Engineering, is responsible for promotion of investment in LED and Mobile sector, matters related to development of indigenous electronic products as identified by Core Advisory Group for R&D in the Electronics Hardware Sector (CAREL) and other strategic needs. He is also nodal officer from DeitY for Make in India programme of DIPP. Additionally, he has been specifically designated for the implementation of the Policy for providing preference to Domestically Manufactured Electronics Products (DMEPs).
Previously in the International Cooperation Division (ICD), Mr. Sharma was responsible for several initiatives of the Government of India, in the field of Project Management & Evaluation, Skill Sets Development and showcasing India ICT Strengths. Prior to this, he was the CIO of Delhi Transport Corporation of Delhi Government where he undertook major initiatives in streamlining the Transport System of Delhi. His visions translated into ‘Automatic Vehicle Tracking System’ (AVTS) which was judged as the one of the Top 10 IT implementations for that year.
In a very detailed discussion, Mr. Sharma shared some quick facts on policies and strategies in regard with the development taking place in the country’s electronics sectors with special reference to LEDs. Here’re the edited excerpts:
For the development of the Electronics Sector in the country, the Government had framed a National Policy on Electronics (NPE). How has been the journey so far on this front?
Government of India has created a focused approach with National Policy on Electronics (NPE) for attracting investment, providing incentives, identifying land for manufacturing clusters etc. – all this to create infrastructure, innovation, human resource, market development and standards. The policy basically aimed at giving a boost to the country’s electronics industry wherein we are still dependent on imports to a great extent. For this, we are inviting applications with much easy investment policies in various directions. All this will help us create and improve the eco-system for design & marketing besides providing the needed platform for innovation and R&D. The policy also aims to ensure strict quality checks of the final products. Apart from that we are also trying to create a market for the industry, which is yet to evolve to the fullest of its potential. This will further assist us in enhancing the necessary human resources that are required for the development of the industry. Together, this not only eyes to enhance domestic manufacturing but also boosting exports.
We are, in fact, encouraging international manufacturers to come and invest in India. The process is on and quite a few overseas players have started evaluating the market for the viability of their investments and accordingly take decision of setting up a facility here in India.
You mentioned creating necessary human resource to boost electronics manufacturing. How is the ministry aiding to enhance the needed skills?
India has a vast pool of innovative and talented human resource. Our human resource is our strength which we offer to an investor from abroad. We produce over 2,00,000 engineers every year. We also propose to enhance the number of post graduates and PhDs in Electronics so that abundant manpower is available for Electronics industry to grow and flourish.
Ministry is keen to upgrade the skills of our people needed to boost electronics manufacturing. There have been large-scale initiatives to create skilled manpower to achieve targets of 1,500 Ph.D. in Electronics Sector Design and Manufacturing (ESDM) and another 1,500 Ph.D. in Information Technology and Information Technology-Enabled Services (IT/lTes). The scheme for setting up seven new Electronics and IT Academies are functional and the Special Manpower Development Program for VLSI and Chip Design has also been approved. Two schemes for skill development and vocational training has been approved with a target of more than 4,00,000 individuals in the ESDM sector.
We understand that India has started designing & producing modules and fab indigenously. What steps are there to promote semiconductor wafer fab?
As part of the efforts to promote the electronics sector, we are promoting setting up of semiconductor wafer fabs in the country. Special incentive package is available for setting up semiconductor wafer fab in the country. India has become the hub for semiconductor design with nearly 2000 chips being designed per year and more than 20,000 engineers are working in various aspects of chip design and verification. Annually, India is generating nearly USD 2 billion in revenues for the chip design services. This provides an enabling environment for the semiconductor wafer fab in India.
As I mentioned, the Ministry has taken several initiatives for promotion of Electronics sector in India. These benefits are available to both foreign companies and Indian companies. These include providing very attractive financial incentives in electronics manufacturing and providing preference to domestically manufactured electronic goods in all Government procurement excluding defence.
Besides, when we speak of electronics, apart from covering electronic hardware products relating to IT and office automation, telecom, consumer electronics, electronic components, etc., we cover a wide range of products relating to verticals like solar photovoltaic, automotive electronics, medical electronics, avionics, LED, etc. To address the issue of infrastructure, a scheme for Electronics Manufacturing Cluster provides financial assistance for creating world-class infrastructure for electronics manufacturing units. For setting up of Brownfield Electronics Manufacturing Cluster, 75% of the cost of infrastructure, subject to a ceiling of Rs.50 Crore is provided.
NPE proposes to setting up of Electronics Manufacturing Clusters (EMCs). How many of those have been formed? How are such clusters helping Indian manufacturing and what benefits do they accrue?
MeitY has received 49 EMC applications so far wherein 12 Greenfield EMCs and 1 Common Facility Centre (CFC) in Brownfield EMC have been approved and are under implementation phase. 16 EMCs have been accorded in-principle approval and the other EMCs are under various stages of consideration These EMCs are all across the country covering various states viz; Andhra Pradesh, Bihar, Chhattisgarh, Gujarat, Jharkhand, Kerala, Karnataka, Madhya Pradesh, Maharashtra, Odisha, Rajasthan, West Bengal, etc.
The basic idea of these clusters is to address the challenges associated with the setting up of electronics manufacturing units in India wherein we are developing an eco-system comprising various facilities viz; water, uninterrupted electricity, better quality roads, centre of excellence, tool room, CAD/CAM design house, component testing, enhanced connectivity along with the smoother and reliable logistics required for meeting the purpose. Keeping all this, in our mind, we are trying to develop islands with all these amenities to bring cost and quality competitiveness.
The whole idea is to identify a hub and boost the much needed electronics manufacturing atmosphere by inviting interested manufacturers from India and abroad, and facilitate them with necessary support. These EMCs will pave the way for the electronics manufacturers and will help in development of entrepreneurial ecosystem, drive innovation and catalyze the economic growth of the region by increasing employment opportunities.
Of these already functional EMCs, have we developed any specific cluster focusing on LEDs?
We have quite a few clusters existing where related components manufacturers are invited. However, LED, especially in lighting, is an area which is almost bursting at seams. All thanks to the Centre for its initiatives with schemes like DELP & SLNP which together have put the industry on the run, boosting LED manufacturers’ morale showing them huge potentials in time to come. Noting the level of requirements, we would definitely be happy to support LED clusters provided the companies started showing interest.
As I said, though we already have a few Brownfield clusters where LED components manufacturers have their setup, we are also in discussion with a few overseas manufacturers of international repute to offer them support and set up a Greenfield cluster soon. Under the policy, we do have set mandatory compliance to safety standards which have been notified for identified Electronic Products with the objective to curb import of substandard and unsafe electronics goods. As of now, 30 electronic products are under the ambit of this order including LED products as well.
Under EMC scheme, what supports the government is offering in setting up of clusters?
EMC Scheme provides financial assistance for creating world-class infrastructure for electronics manufacturing units. The assistance for setting up of Greenfield Electronics Manufacturing Clusters is 50% of the project cost subject to a ceiling of Rs. 50 Crore for 100 acres of land. For larger areas, pro-rata ceiling applies.
For lower extent, the extent of support is decided by the Steering Committee for Clusters (SCC) subject to the ceiling of Rs. 50 crore. For setting up of Brownfield Electronics Manufacturing Cluster, 75% of the cost of infrastructure, subject to a ceiling of Rs.50 Crore is provided.
How this cluster scheme is extending its support to the country’s LED lighting units? How does the ministry enhance & diversify their manufacturing base at their existing place?
One of the driving forces for growth in electronics manufacturing and for growing component demand is the Indian Lighting market. The demand for energy-efficiency has brought forward an immediate need for more energy-efficient products and also has pushed market towards more efficient products such as Light Emitting Diodes (LEDs). In manufacturing, Modified Special Incentive Package Scheme (M-SIPS) provides financial incentives to offset disability and attract investments in LED sector also as in case of the other specified sectors in Electronics Manufacturing. Over the years, opportunities for Light Emitting Diodes (LEDs) in Indian lighting markets have increased especially in automobiles, communications, signage, signaling, architecture and entertainment sectors besides lighting. The opportunity for LEDs in the general space illumination segment of residential and commercial buildings has also emerged and is expanding rapidly.
As per ELCOMA, LED manufacturing in India has grown by 50% to reach Rs. 5092 Crore in 2015-16 and is projected significantly to reach Rs. 8096 crore in 2016-17.
How do you promote the cause of development of electronics, especially in LED?
MeitY has supported five Workshops to target the needs of specific verticals in the electronics hardware manufacturing space conducted through Electronics Industry Associations covering sectors such as Light Emitting Diodes (LEDs), LED Packaging and LED Lights; Computers and peripherals; Mobile handsets, parts and accessories; Colour TV Sets and Set Top Boxes; Telecom Equipment; Industrial Electronics; Semiconductors, Memories and ATMP; Electronic Components; Liquid Crystal Displays (LCDs); Defence electronics; Solid State Memory Products – Memory Cards, USB Drives and Electronics Manufacturing Services.
In the wake all these steps as boosters, what prospects do you foresee for the Indian LED lighting industry?
As per the report, with over 2,500 factories capable of assembling and/or manufacturing electronics, India is heading to become an LED hub for global sourcing. When it comes to assembling, we already are at par with anyone in the world, especially after the introduction of preferential manufacturing access (PMA) to boost domestic manufacturing. However, I agree that when it comes to innovation in this area, we are still lagging and I think we need to promote our skill sets. We do have queries from a couple of units which are looking at manufacturing of LEDs. For all these to move up in the ladder, there is the need of opening up of Centre of Excellence with focused approach. One such Centre is already functional there in IIT Kanpur where students are engaged in research on OLED. We do need to work further in R&D to boost our quality and enhance the manufacturing capabilities by improving on focused skill sets as LED is going to be the sunrise industry and would need the cutting-edge work to compete on the international panorama.
What is PMA and how is it supporting domestic manufacturing?
To boost domestic manufacturing especially in electronics, the government has notified Policy for providing preference to domestically manufactured electronic products in Government procurement, which reserves minimum 30% of all government procurement for items which can show a predefined percentage of domestic value-additions. This percentage of domestic value additions have now been scaled up to reach 65% of government procurement for domestically manufactured electronics and telecom products. However, for LED products, the domestic value addition is 60% for the FY 2016-17 which shall increase 5% every year. It is aimed at meeting ‘net-zero import’ in electronics sector by 2020 to meet a domestic demand of $400 billion.
What major bottlenecks do you experience that the Indian LED industry is facing? And what step is the ministry taking to address it?
As we know, the dire need was to have to propagate LEDs, in regard of which the Government of India has already taken certain initiatives that are working as boosters. These steps were badly needed both from the perspective of energy-efficiency, climate change, as well as the escalating cost of energy. With this, we can see an unparalleled demand for LED lighting facilitating for enhanced manufacturing/ assembling that too with greater interest. As far as chip manufacturing is concerned, we are promoting and inviting foreign players and encouraging them with the provisions of needed infrastructure and incentives to set up their factories under the Make in India scheme. Also, the need is to setting up of labs to support quality products manufacturing. Besides, the greatest challenge is in design and development of LED products, which we are trying to address through opening up of Centre for Excellence to help the future workforce enhance needed skills.