National Policy on Electronics

• 26 Mar 2019

The Union Cabinet on February 19, 2019 approved the National Policy on Electronics 2019 (NPE 2019). This policy supplants the National Electronics Policy of 2012 (NPE 2012).

Key Features of the Policy

• The policy envisions placing India as a global hub for Electronics System Design and Manufacturing (ESDM).
• It is aimed at achieving a turnover of 400 billion dollars for the electronics sector by the year 2025 while generating employment opportunities for one crore people.
• Its objective is also to produce 1 billion mobile handsets in India by the year 2025.
• It envisages creation of an enabling environment for the electronics industries to compete globally.
• It requires creation of a Sovereign Patent Fund (SPF) for the promotion, development and acquisition of Intellectual Property (IPs) in ESDM sector.

Need of the Policy

• NPE 2012 was announced at the time when electronics sector in India was at a low end. Basic ingredients for igniting the sector were contained in that policy.
• From 2014 onwards when basic ingredients were in place, a significant growth has been noticed in the Indian Electronics Sector.
• In comparison to the year 2012, Electronics Sector is no longer an independent sector. The sector is getting into almost everything and thus impacts work of other sectors also.
• Increased number of mobiles being manufactured in the country. 225 mobiles got manufactured in the year 2017-18 as compared to 60 million mobiles that got manufactured in the year 2014.
• India has become one of the biggest users of electronics goods.
• India is already on its way to meet its local requirement of mobile handsets. A policy was needed to make it competitive for exports.
• There are now more number of companies that manufacture mobile handsets and accessories in India as compared to the year 2012.
• India forms only 3% of total global manufacturing in electronics. A new policy was needed to increase this percentage.

Impact

• The policy will encourage different mobile manufacturers in India in setting up 'their supply chain' in India i.e. setting up ancillary and mobile components supplier units in India.
• Once industries set up their supply chain in India, basic requirements of the core product will get fulfilled and India will be able to look for the manufacturing and designing of new products.
• Production of new products will help in meeting the challenges of the emerging technologies like AI, IoT etc.
• SPF will help in reducing cost of IPs in electronics in India.
• The policy will help in strengthening cyber security of the country as the surveillance of electronic products manufactured in India would be easy. Also, India will be able to deploy its own manufactured electronic products in its critical information infrastructure in different sectors of the economy.

Way Forward

• India needs to focus not just on final electronic products but also on the sub components, so that even these can be exported.
• To match with emerging technologies, new components are required and that too at low cost. India needs to find a solution for that.
• The 'know-how' of microprocessors rests with only two and three companies and those companies will definitely not like to share that. Therefore, India needs to tremendously invest into R&D in electronics sector.
• India needs to link this policy with the production of electronic equipments in medical, defence, automotive and power sector and also with fabless chip designing process. This will lead to production of electronic equipments for all the sectors in the country.

Software Industry in India is quite well developed. The new policy will not only provide a boost to the hardware industry but will also make it globally competitive.