The Indian Electronic Systems market is expected to grow under 'Make in India' initiative, as about 65% of the current demand for electronic products is met by imports. This highlights the need for creating ecosystems for capability building in the sector.
The Indian Electronic Systems Design and Manufacturing (ESDM) industry sector comprises Electronic Products, Electronic Components, Semiconductor Design and Electronics Manufacturing Services (EMS). The industry was worth about 125 $ Billions in 2014 and expected to grow to 400 $ Billions by 2020. The segment spread is shown in Fig below.
About 65% of the current demand for electronic products is met by imports.
Electronics Systems in Defence
The defence/strategic electronics form an important part of almost all defence systems and are built into nearly every weapon systems and piece of equipment held by the defence forces. Electronics provide capabilities that are critical to defence requirements. The effectiveness & lethality of weapons systems are dependent upon the electronics subsystems they employ. Combined with “Network Enabled or Network Centric Warfare” (NEW), it will continue to grow in future, enabling far-reaching advances in military capability and efficiency. The major products and systems planned for induction by Indian MoD are:-
- Battlefield Management Systems
- Future Infantry Soldier as a System
- .Long Range Surveillance Radars, Weapon Locating Radars, Mountain Radars
- Tactical Communication Systems
- Software Defined Radios
- EW Systems for different terrains and Aircrafts
- Unmanned Aerial Vehicles and Aerostats
- Long Range Electro Optical Surveillance Systems
- Thermal Imager based Sights for Tanks & Weapons
- Image Intensifier based Passive Night Vision Devices
- Weapon & Missile Systems
- Satellite communication and homeland security solutions
- Electrical systems that comprise components like fuel systems, fire prevention systems, connectors and electrical wiring, etc
- Instrumentation and display systems comprising components like fly-by-wire and autopilot systems,
- Aircraft data display systems, G-load, side slip sensors, temperature and pressure sensors, etc
- Radio and communication systems
- Tank electronics
- Avionics systems
- Underwater electronics
- Communication equipment
- Tools, testers and ground equipment
Market Size-Indian Defence Electronics
The future of Strategic/defence electronics looks very promising due to increasing trend in defence budget allocation, replacement of old equipment/ modernization of forces and import of state-of-the-art electronic equipment and technology. The Indian defence electronics industry has shown in Figure.
Uptrend during the 11th and 12th plan period is likely to continue as well. Approximately 5% of the budget is allotted towards stand alone C4ISR systems. Some of the other major segments are given below.
The ever-growing potential of advanced EW systems as a force-multiplier has been identified by the Indian Armed Forces and various procurement plans are being materialized.
The bulk of the demand (about 70%) will come from the Army, while the Navy and IAF are likely to contribute about 15% each, a significant portion of our EW systems are still imported. Of the total EW pie for the decade, approx Rs 150,000 crore would go into modernising the Army and Rs 30-40,000 cr each to the Air Force and Navy.
Airborne EW which encompasses electronic attack (including jamming and spoofing), electronic protection against jamming and cyber-attack, and offensive cyber capabilities to attack enemy networks would be the future requirements. Some of the recent direct big ticket procurements or in pipeline with EW suits are ,C-130 (FMS)-6, Heavy Lift Heptrs-12, Mi-17 upgrade- 70+, Mi-17 Procurement-80, Light Heptrs -(A/N/AF)-197, MMRCA- 126, M-2000 UPG-52 etc.
Import of Electronics System
On the average about Rs 500 Crores worth of defence electronics were imported by direct purchases in the past as shown in Table. It does not include the import by production agencies and the systems fitted on main platforms.
DRDO Developed Projects
DRDO laboratories engaged in R&D, which are related to various facets of electronics and its applications besides other lab which develop main combat platforms. Thus, from the design and development of solid state materials, devices, microwave tubes, microprocessors, communication systems, command and control systems, radars, electronic warfare systems and electro-optical systems, to advanced computing, artificial intelligence and robotics DRDO's R&D activities cover it all. As on date DRDO is developing products systems, like MBT-Mark-II, Rustom-II, LCA Mark-II, Long Range Missiles, etc. for orders worth Rs 160 billion, and many of its projects are in the completion stage. Hence, it is looking for companies that have the capability to supply to the organisation.
The requirements of the defence sector are opening up opportunities worth US$ 150 billion for the industry, and out of this, over $ 100 billion is open to Indian companies.
Overall Market for Electronics System
Considering the above on-going procurement and also in pipeline, the defence electronics systems market is expected to grow at a rate over 7%, thus providing plethora of lucrative opportunities to Foreign and Indian OEMs. The present year likely spent on Defence Electronics and communication is INR 19960 Crores. Refer Fig below.
The Electronics and Semiconductor Association (IESA), estimate the overall to reach close to $35Bn in the next 10 years, emphasizing on making critical systems and electronics in India to reduce the dependence on imports. This highlights need for more joint ventures and ecosystems created in India. Ministry of Communications and IT has come out with National Policy on Electronics. http://www.eletimes.com/top-stories/make-in-india-for-aerospace-defence-electronics-market-2-lakh-cr-inr-in-coming-five-years/