Top Banner
The State of the Indian PCB Industry Muniswamy Anilkumar President Indian Printed Circuit Association, Indian Printed Circuit Association, Bangalore, India Indian Printed Circuit Association 1
61

Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

May 01, 2018

Download

Documents

dangnga
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Page 1: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

The State of the Indian PCB Industry

Muniswamy AnilkumarPresident

Indian Printed Circuit Association,Indian Printed Circuit Association, Bangalore, India

Indian Printed Circuit Association 1

Page 2: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

AgendaAgenda

I t d ti• Introduction - India Inc. Balance sheet in brief

• Indian PCB IndustryEvolution- Evolution

- Present state- Future prospects

• Government Initiatives to boost theGovernment Initiatives to boost the Industry

Indian Printed Circuit Association 2

Page 3: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IntroductionIntroduction

India Inc.- a macro economic view

Indian Printed Circuit Association 3

Page 4: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Printed Circuit Association 4

Page 5: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Printed Circuit Association 5

Page 6: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Printed Circuit Association 6

Page 7: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Printed Circuit Association 7

Page 8: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Printed Circuit Association 8

Page 9: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India Inc why a macro economic view?India Inc.- why a macro economic view?

Understanding India has often beenUnderstanding India has often been difficult for those who look for archetypes in each country India’sarchetypes in each country. India s sheer size, variety and apparent contradictions confound many observers.

P. ChidambaramFi Mi i tFinance MinisterGovt. of India

Indian Printed Circuit Association 9

Page 10: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India Inc why a macro economic view?India Inc.- why a macro economic view?

The persistence of poverty, illiteracy, p p y, y,malnutrition and the low rank in human development index makes it likedevelopment index makes it like somewhat similar to other poor and developing countries.

Indian Printed Circuit Association 10

Page 11: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India Inc why a macro economic view?India Inc.- why a macro economic view?

However, its software and engineering skills its exports itsengineering skills, its exports, its human resources and, more recently, it biti f i t i iti fits ambitious forays into acquisition of businesses abroad make every bus esses ab oad a e e e yforeign observer sit up and take notice of the elephant that has beg nnotice of the elephant that has begun to dance.

Indian Printed Circuit Association 11

Page 12: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India Inc balance scorecardIndia Inc. balance scorecard F t t G i F M k t E• Fastest Growing Free Market Economy

• Average growth last 10 years : >6%: last 3 years 8% (>9% March-Sept in 2006)(>9% March-Sept in 2006)

• Goldman Sachs Forecast:– Indian GDP would overtake Italy, France and Germany by y y y

2025 and Japan by 2030• Industrial growth of 9% being maintained;

manufacturing sector growing faster Attemptsmanufacturing sector growing faster. Attempts being made to take it to 12-14%.(11.4% growth March-Sept in 2006)( g p )

• 4th Largest Economy by PPP (purchasing power parity)

Indian Printed Circuit Association 12

Page 13: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Economy – on a swing• Growing Global Engagement; merchandise exports of over US$105 bn and imports of US$156 bn. Both growing at over 20% annually.20% annually.

• Surging Foreign Exchange Reserves > US$165 bn.

• Fll investments of US$14 bn and FDI of US$ 8 bn in 2006-• Fll investments of US$14 bn and FDI of US$ 8 bn in 2006-06

• 70% of the companies with FDI yielding higher profitability p y g g p ythan that of the parent company.

3 0 0 6

in U S $ b n1 4 2

1 8 9

2 4 1

3 . 6

3 2 9

4 . 2

3 . 1

3 . 7

5 . 1

1 5 0

2 0 0

2 5 0

3

4

5

7 3 7 6 7 68 6 9 5 9 5

1 1 4

1 4 22 . 73

2 . 4

2 . 92 . 6

5 0

1 0 0

1 5 0

1

2

3

T r a d e

Indian Printed Circuit Association 130

1 9 9 6 -9 7

1 9 9 7 - 9 8

1 9 9 8 - 9 9

1 9 9 9 - 0 0

2 0 0 0 -0 1

2 0 0 1 -0 2

2 0 0 2 - 0 3

2 0 0 3 - 0 4

2 0 0 4 - 0 5

2 0 0 5 -0 6

0F D I

Page 14: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Economy – on a swing (contd.)

Fast improving Infrastructure

• Some of the largest infrastructure creation in the world (Golden Quadrilateral 5 400 kms)the world (Golden Quadrilateral -5,400 kms)

• Planned investment of about USD 300 bn during the next 10 years for creation of expressways and roads p y

•Formation of Special Economic zones (SEZ), th 300 l d d i th t 3more than 300 zones planned during the next 3

years through public-private partnership

Page 15: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Economy – on a swing (contd )Indian Economy on a swing (contd.)

Robust frame-work for Global Business

World’s largest democracyWorld s largest democracy

Global Indians: 30 Min

English widely spoken

Strong judicial system

Page 16: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian Economy – on a swing (contd.)

• Large and growing domestic market – 210 million middleLarge and growing domestic market 210 million middle class, increasing by 15-20 million annually

• Huge upwardly mobile young population with highHuge upwardly mobile young population with high propensity to spend .

• Massive investments planned in infrastructure, both urbanMassive investments planned in infrastructure, both urban & rural- sizable demand for cement, steel, machinery.

• Wide spread modernization in Indian industry with p yliberalization and globalization .

Page 17: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

The state of Indian PCB Industry y

Indian Printed Circuit Association 17

Page 18: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian PCB Industry evolutionIndian PCB Industry-evolution

• Some scientists and research institutes started making PCBs in the late 50sg

• The first commercial PCB production started for in house requirements bystarted for in-house requirements by Bharath Electronics in 60s, followed by Indian Telephone industries and many more defense and space research pinstitutes.

Indian Printed Circuit Association 18

Page 19: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian PCB Industry evolutionIndian PCB Industry-evolutionTh fi t f i l d i t i• The first professional grade private companies started PCB manufacturing in 70s

• The first boom in PCB started between 1985-• The first boom in PCB started between 1985-1990

• The major market drivers-Telecom, defense andThe major market drivers Telecom, defense and space research

• Boom could not sustain due to problem such as, low domestic demand for hardware components, lack of ecosystem (infrastructure), sudden change in technology (telecom) extremely highchange in technology (telecom), extremely high cost of capital and poor financial muscle.

Indian Printed Circuit Association 19

Page 20: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Indian PCB Industry evolutionIndian PCB Industry-evolutionTh d b t t d ft 2001 ith th t f• The second boom started after 2001 , with the entry of some MNC and NRI (non resident Indian) companies in to India

• New set of homegrown entrepreneurs and young management teams infused fresh lease of life in to the i d tindustry

• Some companies also changed the strategy from volume to quick turn productionto quick turn production

• Exports started picking up and quality reached world class standards

• M&A helped domestic companies to reach new heights

Indian Printed Circuit Association 20

Page 21: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India’s position in the world productionIndia s position in the world productionCountry Revenue

(USD Millions)

China 10830North America 4494North America 4494

Europe 3587Japan 10059Taiwan 5869

S. Korea 5020Other Asia 2584Other Asia 2584

India 200

Indian Printed Circuit Association 21Hong kong 154

Page 22: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Major Rigid single/side Manufacturersj g g

Sr No Company ProductionSr. No Company ProductionM2 p.a

1 Epitome Components Ltd 7200001 Epitome Components Ltd 720000

2 Akasaka Electronics Ltd. 480000*

3 Ascent Circuits Pvt. Ltd. 300000

4 Garg Electronics 180000

5 Genus Electrotech Pvt. Ltd. 108000

6 Shogini Technoarts 660006 Shogini Technoarts 66000

7 NSP Electronics 60000

Indian Printed Circuit Association 22*Estimated Figure

Page 23: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Major double/side, Multi-layer Manufacturers (in terms of Sq Meters)(in terms of Sq. Meters)

Sr. No

Company DoubleSid

Multi-L

Total ProductionNo Side Layer Production

1 AT&S 75000 150000 2250002 Shogini Technoarts 13500 45000 1800002 Shogini Technoarts 13500 45000 1800003 Sonic Technology 72000 12000 840004 Circuit Systems India Ltd 52260 23400 756604 Circuit Systems India Ltd. 52260 23400 75660

5 CIPSA RIC 72000 - 72000

6 Fineline Circuits Mumbai 19740 36660 564006 Fineline Circuits, Mumbai 19740 36660 56400

7 Meena Circuits 43200 - 432008 Ascent Circuits Pvt Ltd 36000 5000 410008 Ascent Circuits Pvt. Ltd. 36000 5000 410009 Genus Electrotech Pvt. Ltd. 36000 - 3600010 Fineline Circuits Baroda 28800 6000 34800

Indian Printed Circuit Association 23

10 Fineline Circuits, Baroda 28800 6000 34800

Page 24: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Top Ten manufacturers (Turnover)p ( )Rank Company Turnover

(USD Millions)1 AT&S 40 01 AT&S 40.0

2 Shogini Technoarts 13.3

3 Circuit Systems India Ltd. 12.24 Ascent Circuits Pvt. Ltd. 11.555 E it C t Ltd 11 105 Epitome Components Ltd. 11.10

6 Sonic Technology 9.3

7 CIPSA RIC India Pvt Ltd. 8.0

8 Fineline Circuits, Mumbai 6.6

8 Akasaka Electronics Ltd. 6.6

9 Hi Q Electronics. 5.3

Indian Printed Circuit Association 2410 Genus Electrotech Pvt. Ltd. 4.0

Page 25: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Key PCB Exporter’s y pSr. No.

Company Total Export(Rs. in Millions)

1 AT&S 35.5

2 Sonic Technology 9.3gy

3 Ascent Circuits Pvt. Ltd. 6.6

4 Fineline Circuits Mumbai 6 44 Fineline Circuits, Mumbai 6.4

5 CIPSA RIC India Pvt Ltd 5.6

6 Circuit Systems India Ltd. 2.8

7 Hi Q Electronics 2.1

8 Fineline Circuits, Baroda 2.08

9 Shogini Technoarts 1 5Indian Printed Circuit Association 25

9 Shogini Technoarts 1.5

Page 26: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Competitiveness of Indian LabourCompetitiveness of Indian Labour

Indian Printed Circuit Association 26

Page 27: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Domestic Market for PCBs (Sector-wise)USD in Millions

Sector 2004 2005 2006

Consumer 129 144.31 159.75

Industrial 38.24 43.82 50.22

Computer 99.64 129.44 167.84p

Comm. & B.cast

161.95 204.68 258.62B.cast

Strategic 22.48 25.6 29.13

451 31 547 85 665 56Total

451,31 547.85 665.56

Indian Printed Circuit Association 27

Page 28: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Where is the Big Picture?

Indian Printed Circuit Association 28

Page 29: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Market Indian IT Industry – Year 2005-06 : An Overview

IT Industry in India : USD 37.5 Bn +

Hardware Domestic : USD 7

Hardware E t USD 1 25

Software Domestic : USD

Software & Services E t USD 23 4Domestic : USD 7

Bn Exports : USD 1.25 Bn

Domestic : USD 6.1 Bn

Exports : USD 23.4 Bn

A l S lAnnual Sale :

PCs: 5.1 million TVs: 10 million Mobile Phones : 38 million

I t ll d BInstalled Base:

PCs: 18 million TVs : 110 million Telephone (fixed ) : 50 million

Penetration :

PCs: 18 per 1,000

TVs : 45 per 100 household

Mobile : 75.8 per 1,000,

Access:

Internet Users: 35 Broadband : 0.50 Telephone subscribers (Fixed+Mobile) :

Indian Printed Circuit Association 29

Internet Users: 35 milliion

Broadband : 0.50 million

Telephone subscribers (Fixed Mobile) : 140 million India is a Twenty Billion Dollar domestic ICT (including CE) market today !

Page 30: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Market Market demand by major cities

D e s k t o p S a l e s b y T o w n - C l a s s : 2 0 0 5 - 0 6D lhi

18 % of ICT demand

1 1 1 36 8 5 6 5 3 4 3 3 8 3 36 0 %8 0 %

1 0 0 %

R e s t o f In d ia N e x t 4 T o p 4• Delhi

• Kolkata

4% of ICT demand

1 3 3 0 3 5 4 5 5 1 5 42 01 4 1 2 1 2 1 1 1 3

0 %2 0 %4 0 %6 0 %Kolkata

21% of ICT demand

2 0 0 1 -0 22 0 0 2 - 0 32 0 0 3 - 0 42 0 0 4 - 0 5

2 0 0 5 - 0 62 0 0 6 - 0 7

• Hyderabad3% of ICT demand

Mumbai • Pune

1 % of ICT demand

Consumption in smaller towns improving rapidly

• Bangalore

•Chennai

5% of ICT demand

•Chennai

5% of ICT demand

Page 31: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Market PC Market in India : 2005-06

6 0 0 0 0 0 0

7 0 0 0 0 0 0 PC (Desktops + Notebook) Sales

4 0 0 0 0 0 0

5 0 0 0 0 0 0

6 0 0 0 0 0 0

3 0 0 0 0 0 0

4 0 0 0 0 0 0

1 0 0 0 0 0 0

2 0 0 0 0 0 0

02 0 0 1 - 0 2 2 0 0 2 - 0 3 2 0 0 3 - 0 4 2 0 0 4 - 0 5 2 0 0 5 - 0 6 2 0 0 6 - 0 7

• Desktop sales crossed 4.6 million units in 2005-06; expected growth in 2006-07:21%

• Notebook sales crossed 431 K units in 2005-06; expected growth in 2006-07 : 100% +

Page 32: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Market

The growing Domestic Mobile Phone MarketThe growing Domestic Mobile Phone Market

2 5 0

P r o j e c t e d G r o w t h i n s u b s c r i b e r B a s e

4 88 0

1 3 0

2 1 0

1 0 01 5 02 0 02 5 0

llion

U

nits

4 8

05 0M

i U

2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7

Y E A R

Target 2007 : 200 + million subscribers

Page 33: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Booming mobile phone businessBooming mobile phone business

Si f th k tSize of the market• 2001 – $ 43.47 million • 2006 - $ 4.34 Billion • 2010 $ 50 Billion?• 2010- $ 50 Billion? • India expected to be the second largest

f f 2010market for Nokia in terms of value by 2010• Nokia has committed to invest $150 million $

at its India facility and already shipped 20th

million mobile phone in Oct. 2006 Indian Printed Circuit Association 33

p

Page 34: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Manufacturing

India is now ready for IT manufacturingStandard & Poor upgrades its outlook on India to ‘positive’ from ‘stable’ (April 2006)

Surge in confidence in IT manufacturing

Most leading mobile brands have invested in ghandset and related equipment manufacturing in India- Nokia, Motorola, Samsung, LG, Ericsson .

Strengthening presence of EMS companies –Flextronics, Solectron, Celestica, Jabil Circuits and the latest- Foxconn

All leading PC Brands- Lenovo, Acer , HP have g , ,assembly plants and are aiming at expansion; Dell is the latest entry with a combined investment of $300

illi ( ith li )Indian Printed Circuit Association 34

million (with suppliers)

Page 35: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Nokia, Finland - Mobile Phones: USD 150 Mn

New Electronic Flextronics, USA - Electronic Hardware: USD 100 Mn

Hardware Manufacturers

Hon Hai / Foxconn, Taiwan: Electronic Hardware: USD 110 Mn

ASPOCOMP Finland: Electronic Hardware:ASPOCOMP, Finland: Electronic Hardware: USD 80 Mn

Motorola, USA - Mobile handsets: USD 30 Mn (I Phase)

Spelmech Semi-conductors: USD 45 Mn

Salcomp (USD 40 Mn),

Perlos (USD 45 Mn) and many more component

Indian Printed Circuit Association 35manufacturers

Page 36: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Market The Four Tigers of IT growth

2004 2007Worldwide : 160 Million : 234 Million

India-Volume : 4 Million : 9 Million

India Share : 2 5 % : 4%

2004 2007

India Share : 2.5 % : 4%

India Growth : 32% : 30%

2004 2007 2004 2007 Worldwide : 650 Million : 1040 Million

India-Volume : 22 Million : 90 Million

India Share : 3 % : 9 %

India Growth : 58% : 24 %

W ld id 136 Milli 261 Milli

2004 2007 Worldwide : 136 Million : 261 Million

India-Volume : 1 Million : 10 Million

India Share : 0.4% : 4 %

Worldwide : 51 Million : 80 Million

India-Volume : 1 Million : 5 Million

Indian Printed Circuit Association 36India Share : 2 % : 6 %

Page 37: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Future Potential

India can be your ideal business partnerDomestic electronics hardware equipment market slated to US $ 126.6 billion

in 2010 and USD 363 billion in 2015 , (Source: ISA-Frost & Sullivan, January, 2006)

Domestic electronics manufacturing to grow to USD 58 billion by 2010 and USD 155 billion by 2015. ( Source: ISA-Frost & Sullivan, January, 2006)

National goal- PC penetration 65 per 1,000 by end 2009; Targeted PC sales g p p y gfor terminal yar: 28 million (Source: Ministry of Communications & IT, April 2005 )

Semiconductor and embedded design market size expected to cross USD g p14.4 billion in 2010 and USD 43 billion in 2015 ( Source: ISA-Frost & Sullivan, January, 2006)

Software and Services exports expected to cross US $ 60 Billion by 2010 ( p p y (Source : NASSCOM , February 2006)

Indian Printed Circuit Association 37Indian IT Industry offers great Business Opportunities!

Have you partnered with it as yet?

Page 38: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Percentage of population aged 65 and olderIndia is young and talented

India leads in R & D

6 . 9 7 . 1 5 . 2 51 4 . 7 1 2 . 31 3 . 2 1 6 . 9

1 1 . 4 8 . 3

2 1 . 5 1 8 . 72 2 . 72 7 . 4

2 1 . 11 4 . 8

2 9 . 22 1 . 4

Current patents by Indian Entity

Texas Instruments0 50 100 150 200 250

Chi

na

Kor

ea

Thai

land

Indi

a

Euro

pe

Nor

thA

mer

ica

Intel Oracle Cisco systemGE2 0 0 0 2 0 2 5 ( p r o j e c t e d ) 2 0 5 0 ( p r o j e c t e d )

Source : UN world Population Prospectus; the 2000 Revision and Taipei; China: council for Economic Planning and Development, Official Communication 2002

GE IBMICI

PhD -12,000 p.a2002.

Additional working age population by 2010

PhD 12,000 p.a

Engineers- 600,000 p.a

Graduates -8.5 Mn p.a Intel 3500

U S W . A s i a L . A m e r i c aS E A s i a C h i

In mn

Intel 3500 Motorola 2100Texas Instrument 3450Samsung 2100Sanyo 700

8 37 35 6

4 13 8

2 01 3

C h i n aA f r i c aI n d i a

Sanyo 700HP 3500 Cisco system 2100National Semi conductor 950

8 3

Source: World Economic ForumIBM 3750

Page 39: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Government Incentives for InvestorsGovernment Incentives for Investors

Indian Printed Circuit Association 39

Page 40: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

The Policy Structure: Reforming to Globalize IT Agreement of WTO from March 01, 2005

Customs duty on 217 hardware items are ZERO

Excise Duty (Domestic Levy): 12% on Computers; 16% on Peripherals

One integrated seamless market

State VAT introduced on April 01, 2005; most IT products attract 4%

National GST of 16% by 2010 –a single rate encompassing all local levies e g ExciseNational GST of 16% by 2010 –a single rate encompassing all local levies e.g. Excise duty, State VAT, Octroi etc.

Aggressive Telecom reforms

Broadband Policy 2004; steep fall in prices of international and domestic bandwidthBroadband Policy 2004; steep fall in prices of international and domestic bandwidth

Special Economic Zones (SEZs)

100% foreign equity permitted.

Income Tax exemptions for 15 years.

Banking system & Currency Transaction- Seamless with any global market operations

Policy for Fab and other high capital intensive products such as LCD, storage devices etc. on the anvil

Indian Printed Circuit Association 40SEZ Act & Rules- Incentives made permanent and not

subject to political or administrative discretion

Page 41: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Investment Policy • FDI up to 100% allowed on ‘ Automatic route’ in manufacturing activitiesg

• Ceilings on FDI limits only in 13 sectors and prohibited in 4.

• FDI without permission allowed in most activities• FDI without permission allowed in most activities.

• Foreign collaborations on liberal terms- royalty upto 5% on domestic sales/ 8% on exports plus lumpsum payment ofdomestic sales/ 8% on exports plus lumpsum payment of US$ 2 million on automatic route and beyond with permission .

• Investments made by Foreign investors receive National Treatment .

• Industrial license needed only in five sectors

Page 42: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Taxation in India • Taxes being rationalised and procedures simplified• Taxes being rationalised and procedures simplified

• Major Central Taxes

Corporate tax 30%Corporate tax 30%

Import duty: max 12.5% except on agricultural and certain specified items

Excise duty – 0- 16%

Service Tax

Double Taxation Avoidance Agreements with 65 countries – with Taiwan under negotiation.

• Major State Taxes• Major State Taxes

Value Added Tax-Basic Rates 4 / 12.5 %

• Move towards a comprehensive Goods and Services Tax (GST) regime• Move towards a comprehensive Goods and Services Tax (GST) regime by 2010 to replace central, state and local taxation on goods.

Page 43: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Policy & InfrastructureThe Policy Structure: Duties & Taxes

Item Custom Duty

Excise Duty/Counter Vailing Duty

Additional Duty*

g yComputer Nil 12% 4 %

Peripherals-Motherboard, Monitor Printer Key Board

Nil 16% 4 %Monitor, Printer, Key Board, Mouse etc. Microprocessor Nil Nil 4%

HDD/FDD/CD-Rom Drive/DVD Drive / Flash Drive

Nil Nil 4 %

All other Storage Devices Nil 16% 4%

Mobile Phones Nil Nil 4%

Parts and Components of Nil Nil 4%pMobile Phones

Excise duty and Additional dutyo on input components and sub-assemblies can be offset (CENVATed) against the Excise duty of the locally manufactured Finished

Indian Printed Circuit Association 43product.

Convergence of Service Tax (12%) and Excise Duty- these can be offset agianst each other

Page 44: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Policy Initiatives: Special Economic Zones Law on SEZ

• Policy

Law on SEZ provides policy

stability

Duty free Zones

IT/ Biotech SEZs -10 ha, single- product SEZs – 100 ha and multi-product- 1000 ha.

Units to be net foreign exchange earner within 5 years. No t it texport commitments.

FDI up to 100% permitted in development of SEZ

Transfer of goods from DTA to SEZ treated as exports,

No Limits on DTA Sales

Can be set up in the public, private or joint sector.

Single Window Clearance 150 SEZs approved and 18 already operational

Page 45: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Policy & Infrastructure

The Policy Structure: SEZ-the new vehicle for investments y

Minimum Area for T hardware/Software :

• 10 hectares (10,000 sq. mtrs)

Customs and Excise :

• Allowed to source duty free all capital goods raw materials consumabels• Allowed to source duty free all capital goods, raw materials, consumabels, spares, packing materials, office equipment, DG sets etc. without any license or specific approval .

D ti l b SEZ it t f Addit l D t ( 4% )• Domestic sales by SEZ units are exempt from Additonal Duty ( 4% )

• Domestic sale of finished products, by-products to the DTA on payment of applicable Custom duty.

Income tax

• 100% IT exemption (10A) for first 5 years and 50% for 5 years thereafter.

• Reinvestment allowance to the extend of 50% of ploughed back profits.

•Carry forward of losses

Indian Printed Circuit Association 45

Page 46: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Policy & Infrastructure

The Policy Structure: SEZ-the new vehicle for investments

Foreign Direct Investment

• 100% foreign direct investment is under the automatic route is allowed• 100% foreign direct investment is under the automatic route is allowed in manufacturing in SEZ units.

Banking / Insurance/ External Commercial Borrowings

• External commercial borrowings by units up to $ 500 million a year allowed without any maturity restrictions.

• Freedom to bring in export proceeds without any time limit• Freedom to bring in export proceeds without any time limit.

• Flexibility to keep 100% of export proceeds in EEFC account. Freedom to make overseas investment from it.

• Exemption from interest rate surcharge on import finance .

• SEZ units allowed to ‘write-off’ unrealized export bills.

Central Sales Tax Act:

• Exemption to sales made from Domestic Tariff Area to SEZ units.

Service Tax:

Indian Printed Circuit Association 46

Service Tax:

• Exemption from Service tax to SEZ units.

Page 47: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Policy Initiatives: Special Economic Zones

TAX Incentives for SEZ companies

For Developer : Income Tax exemption for a block of 10 years in 15 years y y

For units: 100% Income Tax exemption for first 5 years 50% for next 5 years and 50% of the ploughedyears, 50% for next 5 years and 50% of the ploughed back export profits for next 5 years

Exemption from indirect taxes; excise salesExemption from indirect taxes; excise, sales, services tax etc.

F d i ECB i h iFreedom to raise ECB with out any maturity restrictions

Page 48: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

India : Comparative Advantages • Low wage costs- unskilled labor at US$ 50-70 / month andLow wage costs unskilled labor at US$ 50 70 / month and semiskilled between US $ 90-120/month

cheaper than in China, Vietnam Indonesia and p ,Thailand.

Wage level expected to be maintained because of g pdemographic profile.

• Substitution of many capital intensive processes by labor is y p p yfeasible – initial capital cost lower by 20-40% .

• High Capacity to produce items requiring design capabilities and embedded software- high availability of IT Skills.

• Huge infrastructure of technical and scientific institutions-annually 600,000 engineers/ technical manpower added.

Page 49: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Conclusion

India Advantage

Local MarketA very rapidly growing domestic market: CAGR 30% +

Gl b l iti f b k d

Profit from

Global recognition for back-end services:

A proven case for IP, embedded systems and IC

Local Sales e bedded syste s a d Cdesign

Attractive for Manufacturing Investments

Advantage

India Improve Costs & quality

for Europe & Others

Use India for IP

and ITeS Services

-New Product development

Skilled employee base

Fast and upcoming modern infrastructure (SEZs)

for Europe & Others - Engineering services

- BPO

Manufacture for Exports

Back end Services

Proximity to EU and MEA markets

Freight Cost; 20% cheaper than China – Faster delivery

d l i li i t Exportsand lesser pipeline inventory

Indian Printed Circuit Association 49

India is a great Opportunity

- Triple Advantage

Page 50: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Setting up and doing business in India is improving fast ……….

Days to get clearance to start business

January 2004 Time taken to clear good at the customs,

in days

3 6Russian Fed 1 0 . 3

India -00

Foxconn/Honhai’s Experience

y y

4 4China 7 . 3

Foxconn/Honhai s Experience • Conceputalised India plan- Apr’05,• First visit to India by CEO – Oct ’05 • MOW with Tamil Nadu government- Mar ‘’05

8 9India 9 . 9China

• Launching production – Jun ‘ 06

1 5 2Brazil 8 . 4Brazil

Source: World Bank Investment climate Survey

Indian Printed Circuit Association 50With States competing with each other, many investors find

setting up business in India quite a quick process

Page 51: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IPCA : Your window to Hardware investments in India

First stop for first hand and complete information on

IT products market and opportunities in India

Policies that are conducive for IT manufacturing

G t i f ti l d il bl l di t t d• Get information already available else sponsor syndicate study

Guidance on how to go about investing in India

Appointments with Key Government officials & ChambersAppointments with Key Government officials & Chambers.

Appointment with industry leaders for first-hand insights.

Networking opportunities for integrating into the IT value chain inNetworking opportunities for integrating into the IT value chain in India from manufacturing to distribution .

• IPCA can help you identify the right business partner

Indian Printed Circuit Association 51Come explore the great Indian IT opportunity with MAIT!

Page 52: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Acknowledgements

Data sources 1. IPCA , India2. WECC report3. ELCINA, India4. MAIT, India 5. Economic Times6. Business line

Indian Printed Circuit Association 52

Page 53: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

THANK YOU A ti l ?Any questions please?

Contact details M Anil KumarPresident Indian Printed Circuit Association (IPCA) 839A, 100 feet Main Road, Indiranagar 1Stage,Bangalore-560038 INDIABangalore 560038, INDIAPhone: +91-80-25250118, 25651772Fax : +91-80-25213212Mobile:+91 98450 23625Mobile:+91-98450-23625www.ipcaindia.orgE-mail : [email protected]

il@i i [email protected]

Indian Printed Circuit Association 53

Page 54: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

…..Infrastructure

• Urban infrastructure :

31 cities of over 1 million population and 393 over 100,000 population.

Elected city governments manage all cities with population over 10,000 persons.

Civic Amenities and infrastructure being modernized under the Jawahar Lal Nehru Urban Renewal Mission US $ 22 bn in 61 cities22 bn in 61 cities

Suburban rail networks: being in 5 million plus metros.

Page 55: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

IT Leaders in India … and indicative list The Whose Who

IT Hardware HCLHCL HP Wipro IBM

Software INFOSYSWiproTCS Telecom

TVS-E D-link ACERSamsung

TCS HCL Satyam IBM

MotorolaEricssonNokiaAlcatel

R&DTIIntel

ISPsSatyamVSNL

TrainingNIITSamsung

LG Flextronics Solectron BPO

AlcatelSamsungSiemensHFCLBh ti

IBMMotorolaWiproGE

VSNLMTNLBSNLBharti

NIITAptech

WeP

EMS Flextronics

Wipro-Spectramind

IBM-DakshWNS Global

Bharti BenqITI

PhilipsST

Honhai/FoxconnJabil Circuits

Services E-Funds EXL Services3i InfotechElcoteq

SolectronCelesticaS i

3i Infotech

Indian Printed Circuit Association 55

Sanmina

Page 56: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Wh t k I di i i iWhat makes Indian companies unique is their ability to operate in the presence of the several constraints like lack ofthe several constraints like lack of adequate infrastructure and a set of demanding value conscious customersdemanding value conscious customers. These constraints have forced our companies to innovate on the products,companies to innovate on the products, processes and distribution which in turn has created companies which are able to poffer superior products and services at a much competitive prices as compared to

h l i th ldanywhere else in the world.

Indian Printed Circuit Association 56

Page 57: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

SEZSEZ

• The Special Economic Zone (SEZ) policy has been envisaged to ensure that India genhances its competitive strengths in international business The SEZ act ofinternational business. The SEZ act of 2005, aims to help businesses reduce costs improve efficiency and facilitate thecosts, improve efficiency and facilitate the development of core sectors

Indian Printed Circuit Association 57

Page 58: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

Why NOKIA “We had visited several locations in the country (India) before zeroing in on Chennai. Our decision has been

chose Chennai based on three key factors...the pro-active approach of the state government, overall development of th d th il bilit fthe area... and the availability of skilled manpower”

Mr. Raimo PuntalaSr VP, Operations & Logistics,Customer & Market Operations, Nokia

Courtesy: Tamil Nadu State Government

Indian Printed Circuit Association 58

Page 59: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

TAMILNADU “The accelerated de elopment of o r project in TamilTAMILNADUChennai

“The accelerated development of our project in Tamil Nadu is largely due to the enthusiastic efforts of the Government of Tamil Nadu.

Chennai is choice due to the efforts of a transparent

Automobile Map and pro-active state machinery”

Mr. Y.S. KimCEO, Hyundai Motors India

“When we looked at locations all over India...not only the existing manufacturing base we looked at thethe existing manufacturing base, we looked at the availability of services and infrastructure-power, water, logistics...and I think equally most important is availability of good well trained labour force and cost competitiveness...and made an evaluation of all the f t d T il N d ll t th t f thfactors and Tamil Nadu really came at the top of the list”

Mr. David E. Friedman, MD & PresidentFord India Limited

Indian Printed Circuit Association 59

Page 60: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

One needs an uncanny acumen to spot opportunities in Indiato spot opportunities in India

Indian Printed Circuit Association 60

Page 61: Muniswamy Anilkumar President Indian Printed Circuit ...policy.electronicsb2b.com/wp-content/uploads/2013/06/PCB.pdf · Indian Printed Circuit Association,Indian Printed Circuit ...

If you succeed in spotting theseIf you succeed in spotting these opportunities , the rewards are

plenty

Indian Printed Circuit Association 61