From robust manufacturing to FDI inflows, India rising on world stage: Piyush Goyal

New Delhi: Commerce and Industry Minister Piyush Goyal on Wednesday shared some of the major highlights from the Ministry in the past few weeks which include robust manufacturing and rising FDI inflows, among others.
Those in the semiconductor and electronics component manufacturing space have a lot to cheer about.
'SEZ reforms have been notified to promote investments and manufacturing. The area required for setting up a factory has been reduced to 10 hectares from the earlier 50 hectares. Moreover, manufacturers have also been allowed to supply domestically after payment of applicable duties,' the minister posted on X social media platform.
In good news for leather exporters, especially those in the MSME sector, port restrictions on export of finished, wet blue, and EI tanned leather have been removed, which means they can be exported from any port or Inland Container Depots across the country.
Also, mandatory testing and certifications have been removed, informed the minister.
'India is cementing its position as the preferred global investment destination with FDI inflow of $81.04 billion in FY 2024-25, growing by 14 per cent over 2023-24. Manufacturing FDI has grown by 18 per cent during the same period, reaching $19.04 billion, in a big boost to 'Make in India',' said Goyal.
All-women Farmers' Producer Company in Odisha gets to send their produce of the famous Amrapali mangoes to Italy, which is 'a big boost for our horticulture exports and a huge opportunity for our farmers to increase their income,' said the minister.
The first commercial consignment of Jammu and Kashmir premium cherries heads to Saudi Arabia and the UAE. Farmers now have a huge market open for them to sell their produce and profit.
The Production Linked Incentive (PLI) scheme has been a game changer for India's manufacturing sector.
'With the scheme supporting 14 different sectors across industries, several success stories have been scripted since 2020, which are making India globally competitive. driving exports and production and creating significant job opportunities,' said Goyal.

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Mint

2 hours ago

• Mint

After assembling 99% of its phones, India faces a harder manufacturing test

New Delhi: Over the past decade, India's electronics manufacturing sector has been defined by one thing: the mobile phone. From 2014 to 2024, the country went from assembling less than 30% of the phones it consumed to 99%, thanks largely to the ₹1.9 trillion Production Linked Incentive (PLI) scheme. According to the ministry of electronics and information technology (MeitY), the value of India's electronics production rose nearly fivefold to ₹9.5 trillion in 2023-24, from ₹1.9 trillion in 2014-15. Yet, for all the triumph in scale, for India to emerge as a global manufacturing powerhouse, it has to go beyond smartphones and also break free from its role as an assembly shop. To make mobile phones, electronic manufacturing services (EMS—or contract manufacturers) companies depend on imports of key components, including cameras, displays, high-end battery packs, semiconductors, and printed circuit boards (PCBs). Even other electronic products—smart TVs, CCTV cameras, computers, wearables, and hearables—are assembled from imported components. If product assembly is about managing global supply chains and focuses on integration and system level performance, 'manufacturing of components involves deeper scientific and engineering complexity," says Vinod Sharma, chairman of the Confederation of Indian Industry (CII)'s National Committee on Electronics Manufacturing. PLI boost Components are the DNA of electronics. However, the components that go into electronic goods in India are still largely sourced from China, Korea, and Taiwan. 'Even now, 85–90% of the electronics component value is imported," says a MeitY report. In 2023, only $15 billion of India's $101 billion electronics output came from components, the report noted. 'Without component manufacturing, there is no ecosystem. You can't make a product unless you can source the heart of it locally. Otherwise, you're just screwing parts together," says Sanjiv Narayan, co-founder of Syrma SGS Technology, a three-decade-old electronics manufacturing company. The ₹3,700 crore company, which exports 30% of its production, has 13 factories manufacturing electronics, automotive, telecom, and industrial electronics products, among others. In an effort to incentivize component manufacturers and boost localization, the government launched a ₹22,919-crore Electronics Component Manufacturing Scheme (ECMS) in April. The last date for companies to apply for benefits under the scheme is 31 July. ECMS will run for six years, from 2025-26 to 2031-32. It offers incentives for the manufacture of various components, including camera modules, displays, and multi-layer PCBs. As CII's Sharma put it, 'Components of components need to be there. The components policy is trying to address this issue by giving incentives for creation of the local ecosystem." Indeed, in a release announcing the launch, MeitY stated: 'The scheme aims to develop a robust component ecosystem by attracting large investments (global/domestic) in the electronics component manufacturing ecosystem, increasing domestic value addition by developing capacity and capabilities, and integrating Indian companies with global value chains." ECMS envisages attracting investments to the tune of ₹59,350 crore, generating production worth ₹4.5 trillion and creating additional direct employment for 91,600, as well as many indirect jobs. It has already received 70 applications— 80% from small and mid-sized players. According to reports, large companies such as Tata Electronics, Foxconn and Dixon Technologies are among the applicants. Queries sent to MeitY are yet to elicit a response. The scheme could provide the missing piece for expansion beyond smartphones. If implemented effectively, it will help build domestic supply chains for crucial components—an essential step in reducing dependence on imports. While the new PLI scheme has a long list of components, India does not have expertise in all of these. Initially, it will go with electro-mechanical components such as relays, switches, fuses and capacitors, for which manufacturing is already happening locally. These are the low-hanging fruit that Indian manufacturers can go after immediately. There is local expertise in parts such as camera modules and the industry will have to bank on collaborations, or global manufacturers might set up base here to make these. Interestingly, back in the 1980s India had a thriving components hub, with up to 80% of the black & white TVs sold in the country manufactured with locally sourced components. But later, with technology shifts, limited scale and zero import duty on components, the ecosystem for electronic parts died an early death. Engineering complexity For all the ambition, manufacturing components is a complex business, vastly different from assembling electronic products such as smartphones. The latter is akin to putting together 400-500 components, including cameras, sensors, a battery, memory, integrated circuits, and other parts to make a fully functional device. While all of that may seem complicated, assembling a smartphone is like a walk in the park compared to making components. To put that in context, each of the 500 or so components in a smartphone has multiple components within them. 'A manufacturer of components is dealing with far more complexity than someone who is assembling those components," says Narayan. 'It is foundational engineering. Making components requires advanced materials science capabilities, highly specialized machinery, precision control at nanometer scales." For instance, making advanced batteries needs understanding of complex battery chemistry, rare materials and very precise manufacturing. 'Right now, India is building the research, deep tech ecosystem and infrastructure needed for this level of manufacturing. As these areas grow, we have a strong opportunity to reduce our reliance on other countries," says Varun Gupta, co-founder of Boult. The company designs, develops and manufactures wireless earbuds, headphones, smartwatches and speakers, among other electronic gear. Each component is a mini-system in itself. Take for instance, the multilayer ceramic chip capacitor (MLCC) energy storage device. Its size varies widely for different applications, ranging from ultra-miniature (0.25 x 0.125 mm) to large (5.7 x 5.0 mm). The ultra-miniature MLCC, which is used in space constrained applications such as smartphones, hearables, wearables, etc., is manufactured by stacking alternating layers of ceramic dielectric material (insulator) and metallic electrodes, then sintering and applying external terminations. This process involves creating 50-100 thin ceramic sheets, printing electrode patterns on them, stacking the sheets, and then firing the stack at high temperatures to create a solid, monolithic structure that ranges in size from a few grains of rice to about a fingernail. Again, companies making camera modules for smartphones will need local supplies of image sensors, lens, infrared filters, digital signal processors (to convert images into digital format, etc.) The global market for camera modules was $43.3 billion in 2023 and is expected to be $68.5 billion in 2028, according to Markets and Markets. South Korea's LGInnotek, and China's OFILM and Sunny Optical Technology are among the large global manufacturers of camera modules. The skills needed for assembly-line operations and manufacturing components are also different. A diploma holder or electronics/mechanical engineer will be ready for assembly operations after about 30 days of training. For component manufacturing, the same talent will have to be trained for up to six months to become familiar with additional manufacturing lines, industrial gases, contamination control, temperature, pressure and working in dust free, ultra-clean environments, among myriad things. Smartphone-centric assembly EMS in India has largely been mobile phone-centric," says CII's Sharma. 'It's like a 4x400 relay race—we've run the first lap, but the remaining three are even more critical." The first leg of India's relay was defined by contract manufacturing of smartphones. Companies such as Foxconn, Wistron, Dixon, and others became the backend for Apple, Xiaomi, OnePlus, RealMe and other brands, while Samsung also scaled up, setting up a large smartphone factory in Noida. PLI-led manufacturing—where the government gives sops between 4-6% on incremental sales—not only made the country self-reliant (largely in smartphones) but also helped scale up local makers such as Dixon Technologies, Optiemus Infracom, Syrma SGS Technology. It also attracted global companies, including iPhone makers Foxconn and Pegatron, and electronic components makers Jabil Circuit and others. But assembly is not manufacturing, and setting up a component ecosystem will help address that lacuna. 'Our value addition in electronics is only 10–15%," says Saurabh Agarwal, tax partner and manufacturing practice lead at EY India. 'It shows that because of PLI, India is among the largest assemblers of phones in the world. But a lot needs to be done to increase local value addition. A lot of critical components are being imported." Also, unlike in smartphones, in the non-mobile categories, which include televisions, air conditioners (ACs), washing machines, IT hardware, and industrial electronics, the volumes are way less compared to what China does and hence makers can't derive economies of scale. In smartphones, India has a better record with around 300 million units being made (read: assembled) and Apple also ramping up production here. However, India still heavily relies on imports for products such as laptops, desktops, other IT hardware and key parts of TVs and washing machines. 'IT hardware players didn't have to make in India to sell in India as import duties were nil to low. Laptop and desktop companies weren't in the same predicament as phone makers like Apple or Samsung," says CII's Sharma. Made in India? CII's Sharma sees design as the third lap of India's EMS relay—and the most ignored. 'You can't build a brand without design. And unless Indian companies invest in original product and component design, we'll never have a Samsung or a Panasonic," he says. This view is echoed by Gupta of Boult. The company reported revenue of ₹3 crore in 2017, its first year, and in 2024-25, clocked ₹750 crore. For manufacturing, it relies on imports of key parts such as chips, drivers, and LED screens. 'We've set up our own SMT (surface mount technology, which embeds chips on a printed circuit board) lines and source plastics and packaging domestically," says Gupta. 'But core manufacturing still depends on global suppliers," he adds. The final lap, CII's Sharma believes, is about building brands. And here, India has stumbled repeatedly. One of the reasons often cited by the industry is lack of volumes. Local brands cannot compete with cheaper imports and are forced out. Though, this is changing in some areas, like ACs. India now makes 22-25 million ACs a year, up from 9-10 million a decade back. China is still the global AC hub with 90 million units, India now has the volumes, which justifies making PCBs for AC inverter controllers, which are currently imported from China. One way to create economies of scale is to collaborate rather than compete. For example, Ashok Gupta, chairman of Optiemus Infracom, argues that India lacks a 'we' culture. 'Instead of collaborating, Indian brands tried to go solo. Without economies of scale, they couldn't survive. The government gave us the PLI cherry. But industry players didn't work together to build the cake," says Gupta. Optiemus has four factories in Noida and makes drones, wearables, hearables, and telecom gear, among other products. It now manufactures for brands such as Realme, Noise, and Boat. EY India's Agarwal points out that companies can scale up from assembly to brands once they have the know-how. For instance, when Intel set up its factory in Taiwan back in the 1980s, local company TSMC benefited and today it is the largest contract manufacturer of chips in the world. New opportunities India's next challenge lies in building a broader industrial base. Companies such as Syrma SGS, Boult and Optiemus are positioning themselves to tap new opportunities in telecom, automotive, and medical devices. Even Lenovo, a Chinese company, has expanded its Puducherry facility to accommodate server manufacturing—an indication that India's next manufacturing chapter is beginning to take shape. But experts warn against over-reliance on incentive schemes. 'Your business model must be viable on its own," Optiemus' Gupta says. 'We have passed the first baton," CII's Sharma says, referring to his relay analogy. 'If we fumble the next stages—building components, design, and brands—we'll never win the race."

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6 hours ago

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DPIIT asks ministries to compile list of business approvals to improve NSWS

Government departments are compiling a list of all business approvals, renewals, registrations and compliances required by business entities to identify duplication and streamline processes, according to official sources. This effort is part of the National Single Window System (NSWS) initiative, aimed at providing businesses a unified digital platform for seamless approvals from both Central and State governments. The initiative is being led by the Department for Promotion of Industry and Internal Trade (DPIIT), which has been engaging with various government stakeholders and industry representatives to improve user experience on the single window system. Industry associations, sources said, have recommended creating an exhaustive, ministry-wise list of approvals and eliminating additional or redundant approvals that fall outside this list. 'The idea is to have symmetry of information, ensure transparency, improve the ease of doing business in the country and reduce the compliance burden,' a senior official said. Commerce and Industry Minister Piyush Goyal launched the NSWS in September 2021. 'The system has been working very smoothly for domestic as well as foreign investors. It has made the lives of investors easier. There is scope for more approvals, including from states, to move to this platform,' said Atul Pandey, Partner, Khaitan & Co. NSWS is a digital platform designed to help investors identify and apply for required approvals based on their business needs. Since investment proposals typically involve multiple approvals across states and departments, the NSWS seeks to eliminate the need for multiple applications across different portals and reduce the number of physical office visits, enabling time-bound clearances. The DPIIT has also held a series of meetings with industry associations, urging them to promote usage of the portal among their members. Users can currently access over 671 Central Approvals and 6,880 State Approvals through the system. The portal now hosts applications for approvals from 32 Central Ministries and Departments, and 29 State Governments. NSWS has also onboarded various government schemes, including the Vehicle Scrapping Policy, Indian Footwear and Leather Development Programme (IFLDP), Sugar and Ethanol Policy, and the National Programme on High Efficiency Solar PV Modules under the PLI Schemes. Under these schemes, NSWS has facilitated over 400 investors in applying for DPIIT's IFLDP applications, while 25 investors have submitted applications for Registered Vehicle Scrapping Facilities.

Time of India

20 hours ago

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Hoteliers urge state govt to address issues to boost tourism sector

Bhubaneswar: Members of the Hotel and Restaurant Association of Odisha (HRAO) on Saturday urged the govt to address challenges facing the tourism sector, including lack of land and infrastructure, to help the state become the 7th most popular destination for tourists by 2027. "The lack of proper infrastructure and land availability is severely hampering tourism development in Odisha. We are ready to invest, but there's a visible gap in demand and supply," said Milind Gupta, secretary general of HRAO, ahead of the 6th Odisha Tourism Conclave scheduled to be held in Bhubaneswar on June 25. He added that the Tourism Policy 2022 did not yield results, and fresh proposals, such as simplifying approval processes and categorising tourism under the special economic zone (SEZ) framework, single-window clearance, and providing capital and interest subsidies for investors, have been submitted to the govt. HRAO members stated that Odisha remains among the states with the least number of hotel rooms, with just 16 classified hotels and 1,055 rooms available till 2023. However, a total of 97.25 lakh domestic and 0.45 lakh international tourists visited the state in 2023, as per the India Tourism Statistics Report 2024. "There was growth in the tourism sector, though the pace is slow. To increase the pace, there is a need for a policy overhaul. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch vàng CFDs với mức chênh lệch giá thấp nhất IC Markets Đăng ký Undo We have high hopes from the govt that they will consider our proposals and include them in the new tourism policy," said Debashis Patnaik, another HRAO member. "The govt identified land banks in 15 places across the state," he added. The conclave will bring together travel experts, investors, and industry leaders to discuss ways to boost infrastructure, attract investment and promote international tourism. According to HRAO, despite its rich cultural and natural heritage, including Asia's largest lagoon, Chilika, and a 480-km coastline, Odisha has been losing over Rs 9,000 crore annually in foreign exchange due to outbound Indian tourism. HRAO emphasised the need to capitalise on the momentum by investing in manpower training and integrating tourism-focused education from the school level.