India potentially perfect for hardware manufacturing

India Inc has got all what it takes to establish itself as a hardware  hub for the worldwide IT community because of the availability of
talented and comparatively cheaper labor, this was stated by B Ramalinga
Raju, Chairman, Satyam Computer Services at CII partnership summit in
Hyderabad. “In less than 10 years IT sector has seen software exports grow
to $ seven billion and this software industry is now well complimented  by a world-class telecom infrastructure. So India
has got all the  potential to play as a manufacturing and electronic design hub for
semiconductor, but we need to make certain efforts to achieve that,” he added.
Commenting on the hardware industry in the South Asian countries he  said that countries like China, Taiwan and Korea are churning out IT
hardware for the world. “Only the Chinese semiconductor industry accounts
for more than $ 150 billion output. As far as India is concerned, I am  pretty sure very soon the chip
manufacturers will look up to India for  setting their manufacturing base over here,” he explained.

Also present at the occasion was James C Morgan, Chairman and CEO for  US based Applied Materials. “We are primarily into making machines that
make microchips and we have our Indian office based at Bangalore. 

Though it is a purely R&D initiative that we have in India, however we are
looking forward to exploring new opportunities in the manufacturing  arena as well,”
Morgan said.

Talking about the emergence of newer silicon markets Morgan said that  at present more and more segments are coming under the umbrella of
silicon chips. ”Now we have chips in almost all the possible electronic  devices - from PDAs to digital camcorders and from washing machines to
mobile phones. As the demand of the chip industry increases we would be  looking for alternative manufacturing bases all around the world and India
would be the proffered choice because of the cheap labor it offers to  the world community,” he explained.

However on the policy side India would soon have to make some changes  if it wants to be a front-runner in the manufacturing arena. As of now
the Indian government’s taxing policies make it very difficult for a  manufacturing company to think of starting a manufacturing unit over here.  

This is the reason why manufacturing majors like LG are still shying  about setting up their manufacturing base over here. The import duty on
cell phones is much cheaper when compared to its manufacturing cost over  here so it does not make an ideal proposition for companies to go for
it.

“There are certain issues at the policy level and they need to be  addressed soon and once we overcome these hurdles, I am sure that we will be
able to attract the world’s attention when it comes to manufacturing  much like we did in the area of software services,” Raju added. 

CYBER NEWS SERVICE

(CNS)