Each year millions of electronic devices are being sold and purchased in India. From laptops, mobiles, tablets, to televisions, speakers and wearables, the list is getting longer and each one requires a repair and services support eco-system. The scale itself is so huge that as per a study by Manufacturer’s Association of Information Technology (MAIT), the electronic repairs market is projected to generate revenues of $ 20 billion per annum in the next four years (from 2025 onwards). It is also foreseen to be among the largest and fastest growing industries in the world.
With a slew of schemes such as PLI (for IT Hardware, Mobile phones, Semiconductors and Display units), SPECS, RoDTEP etc., promoting electronics manufacturing through incentives, this billion-dollar industry shall result in incremental tax revenue generation for the Government of India. Indians as citizens have a tendency to favour repair and maximise life of every equipment that they use. This has the potential of supporting a creative ecosystem in the hardware manufacturing space. A global repair hub in India opens up plenty of opportunities for repairers to earn income thereby generating massive tax revenue for the Government of India.
The India of today prides itself on its demographic dividend. In order to capitalise this dividend, job creation is necessary. Millions of our unemployed youth need to have jobs. This is where the electronics repair sector is particularly attractive. The sector has the potential of qualifying as one of the emerging sectors for employment growth in India. MAIT in its study has pointed out that if requisite initiatives are provided for promoting the electronics repair sector, the country is expected to witness a generation of five million direct job opportunities in the next four years from now. Moreover, in the present scenario of the COVID-19 pandemic which has resulted in all round chaos in the economy, forced businesses to lay off employees and left millions of Indians jobless. This sector is expected to be the next sunrise sector, a boon, which shall open up new job opportunities thereby improving the rate of employment in the country.
The repair of in-service electronic equipment will most certainly enhance its life thereby reducing the amount of e-waste which would have been generated had the electronic gadget been discarded as waste. A lot of repairs are already happening within India for locally available devices, it is the existing custom processes in place, the extant logistic friction and the long TAT for repair that deters major companies from outsourcing major repairs of electronic equipment to India. India has a distinct advantage over China and Europe over cost of labour, it also has world class repair infrastructure owned by both Indian and foreign companies already located within India. All that it needs for the big orders to start flowing is an enabling Electronic Repair Service Organisation (ERSO) Policy. A policy which bridges the existing gap by:
- Creating Repair Hubs- Where all custom and tax clearances are enabled through an efficient and time sensitive process. This is especially important as the repair business has tight customer friendly timelines which require equipment to travel from a landing port to a repair hub and back to the shipping port within 5-6 days after having been repaired.
- Easing Custom Process - De-linking equipment serial numbers imported for repair with those being exported back post repair: The present system requires only the same equipment that has been imported for repair to be exported back and serial numbers are matched by the custom authorities. The Repair Industry however finds it much more convenient to ship a piece that it had repaired earlier and which it stored as a ‘standby’.
- Creation of Logistic Repair Corridor/Channel – In order to keep the TAT as low as 5-6 days, it is essential that the government create a logistic channel/corridor that eases landing port to repair shop movement. The present custom processes would need to be streamlined; technology would have to be exploited to another level.
- Incentivising Repair of Foreign Equipment – Repair of foreign equipment needs to be incentivised to tip the repair economy scale in India’s favour in the Global repair arena. This incentivisation could be by way of reimbursement of excess tax revenues earned from this very sector by the government. This simple mechanism can potentially incentivise growth of ERSO at scale.
The enablement that is required by the country for making India an electronics repair hub is an effective ERSO policy. A policy that incentivises repair of foreign equipment & enables a wholesome regulatory cum logistic solution. A system where logistic and regulatory timelines are kept within a tight control and there is a mechanism to resolve Industry issues in a responsive manner. If the Prime Minister’s vision of making India a $5 trillion economy is to be realised, India would certainly need to see the rise of the electronics repair industry.
(The writer is President, MAIT)
"Electronic" - Google News
February 14, 2022 at 10:51AM
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Not just manufacturing, electronics repair is a $20 billion opportunity, create 5 million jobs - Economic Times
"Electronic" - Google News
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