New Delhi: India is heavily dependent on imports of electronic goods from countries like the US and China to meet its domestic demand, a joint study by Assocham and Ernst and Young on Tuesday said.
Citing reasons for imports, the paper said Indian industries spend little on research and development despite benefiting from 150 percent income tax exemption given on such activities.
The study said the industry spent only USD 0.1 billion on research and development activities in the recent times.
"Meagre spending on R&D by electronics industry has increased India’s dependence on electronics imports as inspite of the fact that 150 percent income-tax exemption," Assocham President Sajjan Jindal said.
India had imported electronics goods worth USD 19.77 billion in the recent times, while the export earnings were USD 3.17 billion, the study said adding that more than 70 percent of electronics appliances demand is met through imports.
"...more than 35 percent of electronics appliances imports in India are sourced from China," it said.
The study, based on inputs from 89 companies, said that the Indian electronics and appliances market is estimated to have a market share of less than 2 percent of the global market, while production share is less than 1 percent.
It also said that the foreign direct investment in electronics industry has been USD 0.75 billion during the nine-year period from April 2000 to March 2009.
Bureau Report
First Published: Tuesday, September 01, 2009, 16:23