The Hindu Business Line : `Electronics growth to propel chip demand to $36.3 b, create 3.5 m jobs'

The Minister for Science and Technology, Mr Kapil Sibal, and the President, India Semiconductor Association, Ms. Poornima Shenoy, releasing the study on Semiconductor Industry in the Capital on Thursday. - - Kamal Narang

New Delhi , Feb. 2

THE CONSUMPTION of electronic equipment in India is set to increase to $363 billion by 2015 from $28.2 billion in 2005, pushing the total market for semiconductors to a whopping $36.3 billion by 2015.

According to semiconductor market research reports launched by India Semiconductor Association (ISA) and Frost & Sullivan on Thursday, the semiconductor-driven industry is expected to create over 3.5 million jobs by 2015. During this period, the gross domestic product (GDP) contribution from this sector would grow to more than 12 per cent in 2015, from about two per cent in 2005 — creating a much larger induced impact on the economy of the country.

"India's rapidly expanding GDP over the next several decades will boost electronics demand in the public and private sectors. Its per capita income will also rise substantially, which is an advantage for consumers in the electronics market. On the policy front, the Indian government is developing India as a IT hardware hub, following the country's success in custom software and IT services. It is actively encouraging foreign investment to build India's IT hardware industry," the reports said.

The first report titled `India Semiconductor Market, 2005-15: Growth, Trends and Forecasts', is a detailed analysis of the rapidly growing semiconductor content in the electronic equipment end-user markets and its impact on the semiconductor market in India. The second report — `India Semiconductor and Embedded Design Market, 2005-15: Growth, Trends and Forecasts' — comprises analysis and forecasts of the semiconductor and embedded design market and outlines engineering manpower costs and future requirements.

The ISA-Frost & Sullivan reports outlined that the Indian electronics equipment production grew at 25 per cent in 2005, and is slated to touch a growth rate of 50 per cent in 2010 and 34 per cent in 2015.

The reports cover all the end-user products and capture their individual contribution to the total market, with market and technology trends. The second report reveals the semiconductor and embedded design (including chip design, hardware board design and embedded software) industry in India generated revenues of $3.25 billion in 2005, and could reach $43 billion by 2015 growing at a compounded annual growth rate (CAGR) of 30 per cent during the forecast period. On the industry potential to create jobs, it said that the industry has been able to generate 0.52 million jobs (including semiconductor and electronic equipment manufacturing, semiconductor and embedded design) in 2005.

"The entire industry (semiconductor and embedded design, electronic equipment manufacturing and semiconductor manufacturing) is expected to generate revenues of $73.92 billion by 2010, and generate employment for 1.85 million employees.

In 2015, the industry revenues are expected to increase to $202.57 billion, which is expected to generate employment for 3.58 million workers," it added.

The Union Minister for Science and Technology and Ocean Development, Mr Kapil Sibal, released both the reports.