The Next Step

Indian technical manpower can be trained for high-value-added emerging services in the era of mass commoditisation of hardware.

- Rajeev Srinivasan

INDIAN IT IS running into a road-block, as the traditional services business model seems vulnerable. I attended the IESA’s (Indian Elec-tronic and Semiconductor Association) Vision Summit in Bangalore in February, and the implied question there was whether the vacuum could be filled by the other side of IT: electronics. It is not entirely clear that we can be saved by electronics, but it’s worth a shot.

Electronics may finally be coming into its own in India. Even though the concerned Indian ministry is MeitY, the Ministry of Electronics and Information Technology, the focus has been on software, given its status as a national champion over the last 20 years. And manufacturing is not one of India’s core competencies, many feel.

Besides, the shortcomings of India’s ecosystem have more of an impact in the electronics sector. Lack of reliable power and water, poor infrastructure, the skill sets of technical manpower, and the virtual absence of the semiconductor industry in India have all been problems. Semiconductor fabrication, a strategic industry, is a must if India is to have dependable and secure electronic devices, but that’s another story.

Apart from all this, there are social reasons too: the tradition in engineering in India has been to do theoretical things; the whole idea of doing things with one’s hands (the “Maker Movement”) is somewhat alien.

But things have changed recently, based on three interrelated things: the spread of gadgets such as mobile phones, tablets and computers, the growth in internet usage, and increasing levels of prosperity. MeitY suggests that India’s electronics marketplace was about $80 billion in 2015, of which half was produced locally. But demand is expected to skyrocket to $400 billion by 2022 or so, and that would make India’s electronic import bill greater than its oil import bill! The large market is a clear pull factor.