Why India is Becoming a Global Hub for Electronic Manufacturing

Electronics manufacturing is now recognized as one of the fastest-growing sectors, drawing global consumers and establishing India as a leading contract manufacturing hub. The Covid-19 outbreak has only increased the demand for gadgets and pharmaceuticals. The Indian contract manufacturing sector is expected to grow at a CAGR of 13.3% from 2023 to 2028. Additionally, the Indian electronic manufacturing industry is expected to experience a significant growth, with its value projected to rise from USD 23.5 billion in 2019-20 to USD 152 billion by 2025.

India is in a position to become a global contract manufacturing powerhouse, thanks to ample raw material availability, a young labor force, and a sizable talent pool with manufacturing and entrepreneurial skills.

In this blog post, we discuss why India is emerging as a go-to destination for many companies.

Why Are Companies Choosing India as a Hub for Electronic Contract Manufacturing?

India stands out as a beacon of opportunity in the rapidly changing environment of global electronic manufacturing for Original Equipment Manufacturers (OEMs) seeking economic and strategic advantages. Beyond its labor and production cost advantages, India provides a wide range of resources that can meet the complex requirements associated with modern electronics manufacturing.

India’s reputation as a center of electronic manufacturing has significantly increased because of several factors listed below.

Competent Resources and a Skilled Workforce

India attracts OEMs for reasons that go beyond its financial advantages. India offers a variety of strategic benefits, including a wide range of qualified workers with engineering knowledge, design expertise, and cost-effective labor. India has a workforce competent in English, which increases its appeal for contract manufacturing. This linguistic advantage, skill, and affordability position India as a compelling choice for OEMs looking for value and expertise.

Improved Ease of Doing Business and Professional Capabilities

The increased efficiency of managing governmental processes is another significant benefit. International investors have had challenges in conducting business because of bureaucratic roadblocks. However, the environment appears to have changed because of the Indian government’s relentless efforts. The Indian government’s relentless efforts have made relationships with governmental resources more accessible by streamlining administrative processes and reducing regulatory complexity. This has sped up the establishment of manufacturing facilities and reduced potential areas of friction for OEMs looking to enter the Indian market.

Effective Sourcing of Raw Materials

India is already widely considered a top location for effective sourcing of raw materials because of numerous benefits, including quick access to resources, efficient production techniques, a skilled workforce, and robust export systems. The cost advantage makes it profitable for foreign investors to use its resources, ensuring an alluring return on investment. The diversity of India’s natural resources adds to its appeal as a reliable provider, satisfying the demands of the global manufacturing sector. This confluence of factors solidifies India’s position as a reliable sourcing hub.

Empowering Supply Chain Resilience

India’s environment for electronic contract manufacturing has changed substantially, with a thriving market for precision components and innovative raw materials. This innovation serves sectors like aerospace and healthcare that require high-tolerance components. Localized production of precise components and new materials allows businesses to navigate disruptions adeptly. Furthermore, the variety in sourcing options enhances supply chain resilience, decreasing dependence on single sources.

Leading Subcontracting Hub

Favorable factors, such as motivating government programs and the economic edge stemming from inflation-affected developed nations, have contributed to India’s rise as a major player in the electronic subcontracting market. The development of India’s fresh sourcing capabilities also improves its competitiveness, making India a desirable location for international OEMs to grow, develop, and flourish. The industry’s strong development trajectory cements India’s position as a critical partner for OEMs worldwide.

Government Initiatives and Technological Integration

The Indian government has introduced various schemes like the Production Linked Incentive (PLI) Scheme to boost local manufacturing and attract foreign investment. This initiative aims to make India a global manufacturing hub by encouraging large-scale electronics manufacturing. According to the India Brand Equity Foundation (IBEF), India’s electronics market is expected to reach USD 400 billion by 2025. The increasing investments in R&D and technological advancements are driving this growth. Indian manufacturers are increasingly adopting advanced technologies, such as AI, IoT, and robotics, to enhance production efficiency and product quality. This tech adoption positions India at the forefront of innovative manufacturing practices.

India is establishing itself as a multidimensional destination for electronic manufacturing, including cost savings, skilled labor, ease of doing business, efficient raw material procurement, and supply chain resilience. Because of this complete approach, India is developing as a major player in the global contract manufacturing business, particularly in electronics.

For prospects looking for a dependable partner to optimize manufacturing processes, HBeonLabs stands out. As an electronics manufacturing company in Noida, we specialize in providing high-quality solutions to our clients. Our experience in IoT remote monitoring systems and OEM/ODM services puts us as industry leaders. 

Join us in transforming the electronics manufacturing environment and establishing India as a global leader.