Quality of an electronic equipment is directly proportional to the kind of components used in it. No matter how good is the design or the structure, the performance of the equipment is dependent on the quality of electronic components
of the particular device. Malfunctioning parts can result in disruption or poor performance of the equipment. If the equipment stops working pretty early in the life cycle, the cost incurred is significant burden for the buyer. This is the reason why we are seeing the growth in demand for electronic components across the globe. Manufacturers from different industries are relying on electronic component makers and distributors for several parts used in their respective end products.
Studies have shown that electronic components that are produced in large number are transformers and coils, diodes, transistors, resistors, capacitors, switches, relays and connectors etc.
The current market in India has a strong demand for these components and it is witnessing new technologies finding their application in the segment, keeping the market share consistent. These technologies are LED/LCD and solid-state storage devices. Some of the primary areas of demand for electronic component are consumer durables and telecommunication. After these two major demand sectors, there are other segments such as information technology and office automation and automotive industries that are witnessing high demand. The remainder of the market share goes to areas such as industrial electronics, medical electronics, strategic electronics and lighting industry.
Need for a level playing field
Given all the growth factors, there are some challenges impeding the further progression of the market. “The effect of import of component from various parts of the world has affected the Indian market, as nearly 60 to 70 percent of the requirement is imported; this is because of a non-level playing field. Indian components suffer a disability of 10-15 percent due to high cost of capital, high cost of power and high cost of logistics,” says Vinod Sharma, Managing Director, Deki Electronics. Hence, there is clearly a need not just for a level playing field but also a conducive environment with incentivised support to help the indigenous manufacturing boom in the country.
A lot has been done in this direction by the government through its PLI schemes and other initiatives. Industry is now getting ready to embrace the productivity demand arising from projects like Smart City and Digital India. The banking sector is also going to add to the evolution of the sector. Under the effect of these factors, the electronic component industry is poised to tread on a path of rapid growth.