Blog Articles

India’s Consumer Appliances & Electronics Market

India’s appliance and consumer electronics market is projected to double to reach $21.8B by 2025. The production of consumer electronics contributes to over 17% of total electronics produced in India. The major growth drivers of this segment are the rise in spending of the middle-income group among non-traditional consumers. There’s an emergence of a new kind of “Home Essentials” category like microwaves, dishwashers, trimmers, TVs, air conditioners that have now turned essential for a sustainable and comfortable lifestyle post-COVID. [1]

Increasing India’s Rural Demand

The consumption pattern of home appliances is witnessing an uptrend in rural areas due to increasing technology awareness and product affordability. Surprisingly, the annual consumption growth rate in the Indian rural market exceeds urban consumption by over 1% point at 9.7%. Rural Indian households are spending more on basic, healthcare, and education needs than a few years ago. [2]

This has led the brands to shift their focus towards rural markets as it holds the largest demand base of more than 720M consumers. Refrigerators, kitchen appliances, and other consumer electronic goods are likely to see demands in the years to come as the government’s rural electrification and power infrastructure up-gradation is taking a new shape. [3]

Increasing Need for Localization

Around 95% of consumer electronics and appliances sold in India are assembled locally. However, dependence on China for components and completely knockdown kits still ranges up to 70% of the total value addition. In order to overcome this domestic disability, the Indian government is pushing for a self-reliant India market especially for consumer electronics such as televisions, air conditioners, mobile phones, and many more.

Recent amendments of import policy, such as licensing import of fully-built televisions, is one such move towards achieving self-reliance. This forces the importer of the commodity to seek an import license from the government and imposes a soft barrier to easy entry. There could be more such announcements coming in the consumer electronics segment creating a need for a localized supply chain in the field of consumer electronics.

India’s Favorable EMS Ecosystem

Industries across the world are revisiting their global supply chain and reworking alternative business continuity plan. There’s a clear proposition across the board of companies to move to China plus one strategy to reduce their dependence on a single source. It’s a favorable time for India’s capabilities to support the design-led manufacturing of such consumer electronic products.

The government is making multiple moves to improve the ecosystem for manufacturing. Initiatives like permitting 100% FDI and providing CAPEX and disability subsidy in consumer electronics manufacturing encourage more foreign companies to set up manufacturing facilities in India. The government’s focus on ease of doing business and liberal incentive packages announced for investments in electronics is an added advantage.

Backed by 40 Years of Expertise

Syrma provides electronics design and manufacturing services to diverse markets. Over the last decade alone, we’ve helped to design, manufacture, and bring to market more than 400 million product units worldwide. Our EMS, RFID, magnetics, electromechanical, and IoT products are designed and manufactured to the highest quality standards. We provide board & box building services to leading consumer electronic OEMs for various products, such as air conditioners, home automation, water meters, and other IoT products.

We assist global OEMs seeking to enter the Indian market by leveraging the local supply chain and favorable operating environments for cost reductions. Our flagship Chennai location opened in 2006 and lies within a Special Economic Zone (SEZ) for electronics manufacturing, offering economic incentives for imports and exports. This primary facility is within 90 minutes of the Chennai seaport and 20 minutes to the international airport, with additional road and rail connectivity linking to the rest of India and beyond, as well as infrastructure advantages with faster import and export clearances.

We also have labor force availability, both technical and manual, to rapidly scale to client demand. We look forward to discussing how we can deliver world-class products for OEMs and solution providers across the globe.

To learn more about this topic, please contact us.

Syrma TechnologyIndia’s Consumer Appliances & Electronics Market

Related Posts