Date: 07/03/2012

Electronics hardware manufacturing cluster in Ananthpur

component manufacturing association ELCINA and Vittal Innovation City (VIC) have jointly announced the launch of their Electronics System Design and Manufacturing ( ESDM) Model Cluster in Ananthpur District of Andhra Pradesh. Though in Andhra Pradesh, Ananthpur is near to silicon city-- Bangalore. Ananthpur district border is around 100 KM from the Devanahalli international airport, Bangalore. There are high chances this cluster becoming very successful.

Union Government is working hard to get the growth in hardware similar to the software and IT services growth in 1990s to till now. Though the things are not moving fast, Department of Electronics and Information Technology (DeitY) is doing robust ground work in support of ESDM. It has proposed 200 clusters to be set up under the draft National Electronics Policy 2011 of Government of India.

The Cluster to be owned and managed by the members who have manufacturing units located within the Cluster. The responsibility of running the cluster will be held jointly between ELCINA and VIC.

The challenge in electronics manufacturing compared to software development is machine/equipment and manufacturing process becoming fast obsolete, just like the Windows OS based computers, they are only worth 3-5 years, with in that time frame maximum profit has to be made.

One example of disruptive technology in electronics manufacturing is: With 3D semiconductor fabrication happening faster, it is expected chips on PCB are going to be easy to wire using lesser number layers of PCBs, so that complex PCB assembly system is less required for some of the mass-consuming applications. So, much of the system/device blocks recide inside an IC cube, a new name for 3-dimensional IC chip. Yet it’s a prediction, the bigger global market forces will decide which way is better for them. There are many disruptive technologies visible on the horizon.

So Indian hardware business need to go very-very fast, if it uses imported manufacturing technology, otherwise has to get into indigenisation of manufacturing technology rather than manufacturing. Both are also possible. Nokia, Samsung and many such international brands may be making latest phones in India, but the process, and IP is not owned or controlled locally.

Here below is our earlier article on Union Government announcing draft National Policy on Electronics:

With the Union Government announcing draft National Policy on Electronics, Indian electronics and semiconductor industry can still see there is a hope for India to become a manufacturing center for electronics. The draft policy sets out to achieve a turnover of about USD 400 Billion by 2020 involving investment of about USD 100 Billion. It also aims at ensuring employment to around 28 million in the sector by 2020, stated in the release.

Major strategies proposed in the draft policy include:

1. Providing attractive fiscal incentives across the value chain of the ESDM sector through Modified Special Incentive Package Scheme (M-SIPS).

2. Setting up of Semiconductor Wafer Fab facilities and its eco-system for design and fabrication of chips and chip components.

3. Providing Preferential Market Access for domestically manufactured electronic products including mobile devices, SIM cards with enhanced features, etc. with special emphasis on Indian products for which IPR reside in India to address strategic and security concerns of the Government consistent with international obligations in procurement.

4. Providing incentives for setting up of over 200 Electronic Manufacturing Clusters with world class logistics and infrastructure.

5. Creating an "Electronic Development Fund" for promoting innovation, R&D and commercialization in ESDM, nano-electronics and IT sectors including providing support for seed capital, venture capital and growth stages of manufacturing.

6. To use innovation and R&D capabilities to develop electronic products catering to domestic needs and conditions at affordable price points.

7. Setting up Very Large Scale Integration (VLSI) specific Incubation Centres across country.

8. Developing an India microprocessor for diverse applications/ strategic needs.

9. Creating a 10 year stable tax regime for the ESDM sector.

10. Setting up a specialized Institute for semiconductor chip design.

11. Encouraging greater participation of private sector in human resource development for the sector. Also encouraging setting up of skill-oriented courses for electronic designs along with hands-on laboratories enabling graduates from other disciplines to migrate to ESDM.

12. Developing and mandating standards for electronic products specific to Indian conditions of power, climate, handling etc.

13. Creating linkages for long term partnership between domestic ESDM industry and strategic sectors like Defence, Atomic Energy and Space.

14. Setting up of Centres of Excellence in the area of automotive electronics, Avionics, and Industrial electronics.

15. Adopting best practices in e-waste management

16. Setting up of a National Electronics Mission with industry participation to advance the implementation of various programmes in this policy.

17. The Department of Information Technology to be renamed as Department of Electronics and Information Technology (DeitY) to reflect the desired focus on electronics.

The draft Policy is available on the website of Department of Information Technology (www.mit.gov.in). Comments and feedback on the draft Policy are invited by Department of Information Technology.