electronic hardware sector
DESCRIPTION
GIM 2015 electronic hardware sectorTRANSCRIPT
Electronic Hardware Sector
AGENDA
Electronic Hardware : Global scenario
Electronic Hardware : Indian scenario
Electronic Hardware : Tamil Nadu scenario
Investment opportunities
Government Support
Electronic Hardware: Global Scenario
The Global Electronic Hardware industry is valued at around USD 2 trillion and is one of the largest and fastest growing manufacturing industries in the world.
15% 18%
22%
42%
3% 6%
19% 15%
52%
8%
6.2%
18.7% 14.9%
52.%
8.3%
0%
10%
20%
30%
40%
50%
60%
Japan North America Europe Asia pacific Rest of the World
World electronic industry production by region
2008 2011 2013
The production of electronic products has shown a change in trend from the developed economies to the countries in the Asia-pacific Region.
Communication equipment, Computers and peripherals and Consumer electronics are the top three sub-sectors contributing to the world electronic industry production.
Communication equipment
27%
Computers and Peripherals
25%
Consumer Electronics
13%
Strategic Electronics(Go
vt/military) 9%
Industrial Electronics
9%
Instruments 8%
Automotive Electronics
7%
Other Electronic
components 2%
Share of different segments in world electronics production (FY13) India’s share in the world production
is only 1.5%. Hence a lower penetration of these subsectors represents India’s immense potential for the growth of the industry both on the domestic as well as the international front.
The major semi-conductor end-user segments have been identified as communications, IT and consumer electronics.
The main categories that are expected to drive the semiconductor market in India are semi-conductor designs , microprocessors, analogue devices, memory chips, discreet circuits and Application- Specific Integrated Circuits (ASIC).
Semiconductor Industry – An Upcoming Industry In India
240.2
791.1
2610
7980.8
484.7
459.5
1529.5
6960
24,297.20
1647.6
0 10000 20000 30000
Automobiles
Electronics and durables
IT hardware and officeautomation
Telecommunications
Commercial electronics
USD Million
Market for semiconductors across different industries
2015(Estimated)
2010
12% 8% 12% 3% 3%
29%
13% 14%
11% 13%
8%
5% 7%
3% 5%
5% 39% 30%
37% 43%
46% 34% 37%
46% 36%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007-08 2008-09 2009-10 2010-11 2011-12
Electronics Exports by sub-sector, % to total exports
Electronic Components
Communication and Broadcast Equipments
Computer Hardware
Industrial Electronics
Consumer Electronics
10.02
52.58
0
10
20
30
40
50
60
2013 2020
Growth of the Semiconductor industry in USD billion
The Semiconductor industry is expected to register a CAGR of 27% by 2020
Government Support
•100% FDI is permitted in the electronics hardware manufacturing sector under the automatic route
•100% income tax exemption to SEZ units on export profits for five years, 50% for the next five years Encouragement to FDI, SEZs
•Government approved the National Policy on Electronics (2012) with an ambitious target of reaching a market size of USD400 billion by 2020 and creating indigenous manufacturing of USD 320 billion
•It aims to set up 200 manufacturing hubs across the country with an investment of USD100 billion to meet demand expectations
•The policy also focuses on raising exports to USD80 billion by 2020
National Policy on Electronics (2012)
•25% of capital expenditure if the ESDM unit is in non-SEZ and 20 % of capital expenditure if the ESDM unit is within SEZ. This capex subsidy is available for investments made within 10 years from the date of approval of the project.
•Reimbursement of CVD/excise on capital equipment for non-SEZ units.
•Reimbursement of central taxes and duties (like custom duties, excise duties and service tax) for 10 years in select high- tech units like fabs, Semiconductor Logic and Memory chips, LCD fabrication.
MSIPS
•For Greenfield EMCs: Financial assistance of 50% of the project cost subject to a ceiling of Rs. 50 crore for every 100 acres of land
•For Brownfield EMCs: Financial assistance of 75% of the project cost subject to a ceiling of Rs. 50 crore. Electronics Manufacturing
Clusters (EMC) Scheme
•An EHTP unit may import free of duty all types of goods, including capital goods as required by it for manufacture, services, production and processing
• EHTP provides benefits, such as duty waivers and tax incentives, to companies which replace certain imports with local manufacturing.
Electronic Hardware Technology Park (EHTP)
Schemes
•Special incentives have been designed to attract investments for setting up semiconductor fabrication and other micro and nanotechnology manufacturing industries.
•The government has provided two options for setting up a project. For setting up Semiconductor Fabrication Units and Eco System units in SEZ's the government will fund 20% of the capital expenditure and for non SEZ's 25%+exemption from ( Countervailing Duty ) CVD .
Semiconductor Policy
Electronic Hardware: Tamil Nadu
Tamil Nadu is the 3rd largest manufacturer of Electronic Hardware in India Tamil Nadu’s contribution to the national electronic hardware output has increased from 10 % in 2008-09 to
14.6% in 2012-13.
Electronic Component
s 25%
Computer and
peripheral equipment
41%
Communication
equipment 14%
Consumer Electronic
s 0.34%
others 20%
Share of major subsectors in total electronic hardware industrial output of Tamil Nadu
(2011-12)
13.66
16.80
18.12
16.96
17.80
1.35
2.25
2.46
2.97
2.60
0 5 10 15 20
2008-09
2009-10
2010-11
2011-12
2012-13
USD Billion
Total electronic hardware industry output of Tamil Nadu
Total electronic hardware industry output of India
Major Players in Tamil Nadu
Tamil Nadu’s Competitive Advantage
The total investment in the electronic hardware industry in Tamil Nadu is 711 million USD employing more than 40,000 workers in both organized and unorganized sector.
Product Major players
Mobile handsets and Communication networks ,
Mobile handset Components , Keypads for Mobile
handsets
Electronic hardware and mobile phone components
Electronic Hardware
Electronic Consumer Durables
Computers
Semi-Conductor testing and packaging
Invested capital in USD Million
Industry 2008-09 2009-
10
2010-
11
2011-
12
Computers
and
Peripheral
Equipment
77.6 97.3 119.5 140
Electronic
Components 153.1 456.0 252 242.8
Communicati
on
equipment
182.5 180 162.2 139.5
Consumer
Electronics 3.36 2.70 2.02 1.83
Tamil Nadu stands 1st in terms of Electronic exports in India
46%
17%
14%
12%
3%
1.76%
1.54%
0.96%
0% 10% 20% 30% 40% 50%
Tamil nadu
Karnataka
Uttar Pradesh
Maharashtra
Kerala
Delhi
Gujarat
Andhra Pradesh
Share of Top States in Electronic Hardware Exports of India
8870
11350 12380
2011-12 2012-13 2013-14
US
D M
illi
on
Export of Computer Software & Elec. Goods from Tamil Nadu in USD million
Exports of software and electronic goods have grown at a CAGR of 18% over the last 3 years.
Sriperumbudur Hi Tech SEZ
Flextronics, Samsung ,
Motorola, DELL Computers,
TAPP Semi Conductor,
Natronics Semiconductor
Oragadam Hi Tech SEZ
Sanmina , Moser Baer,
Signet Solar , Seimens
Networks , BYD China ,
Polymatech
Mahindra
World City
Kanchipuram
Coimbatore
Krishnagiri
Tirunelveli
Madurai
Salem
Tiruchirapalli
Existing Electronic
clusters
Upcoming Electronic
Hardware clusters
Existing electronic
hardware SEZs
Chennai
Existing Electronic Hardware SEZs in Tamil Nadu
Hi-Tech SEZ for the manufacture of Electronic/ Telecom Hardware and Support services (571 Acres)
Hi-Tech SEZ for Electronic Hardware and related support services (348 Acres)
Mahindra World City
Upcoming Electronic Manufacturing Clusters in Tamil Nadu
Coimbatore District, Tamil Nadu Electronic Industries Association of India (ELCINA) plans to set up an EMC in the District of Coimbatore in India under the name Coimbatore City Electronics Cluster (ADD Industrial Park) under the EMC scheme.
GMR Special Investment Region (GSKIR) is a strategically planned project over 4300 acres near Hosur, Krishnagiri. The EMC cluster of 527 acres and has a multi-modal connectivity covering national highways, State highways and railways. Tamil Nadu has over 23 Electronic Hardware Technological Parks
located in major IT centric Special Economic Zones(SEZs) of Sriperumbudur, Oragadam, and Mahindra World City.
Photovoltaic panels
Communication hardware and networks
Mobile handsets Computer peripherals
Semiconductors Medical electronics
Opportunities in Electronic Hardware Sector
Additional Chief Secretary - Government of Tamil Nadu Industries Department
Phone: 91-44-25671383 Fax: 91-44-25670822 Email: [email protected], [email protected]
Nodal agency
Tamil Nadu Industrial Guidance and Export Promotion Bureau
19-A, Rukmini Lakshmipathy Road, Egmore, Chennai-600 008
Phone: 91-44-2855 3118
Email: [email protected]
Visit us at www.tamilnadugim.com