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Media Round Table on Budget
Recommendations
Hosted byAlok Bharadwaj, President MAIT
Sabyasachi Patra, ED MAIT
22nd February, 2012
Industry Background
• Industry Size: Global : The Global electronics industry is roughly 2.9% of Global GDP (1.75 tillion/60 trillion USD). It is 4.40 times oil, petrol and minerals.
• India Demand: The electronics demand in India is projected to grow at a CAGR of 22% and reach USD 125 billion by 2014 and USD 400 billion by 2020 with a net imports of over 323 billion USD.
• Significant growth potential: Growth in the industry will boost the economy, as this industry works as a feeder industry for other industries. It is an enabler industry necessary for productivity
• Employment opportunities: It is anticipated that the industry can potentially employ close to 27.8 million by 2020 (3 times from 2010 levels). Job Creation is the vital National Agenda. Also this industry employs a lot of women & young workforce
First Looking at entire ICTE Industry
Domestic IT Industry... Let us examine last year first
Yr 2010-11 Rs Cr $ B GROWTH
IT Hardware 70677 16 28%
IT Services 76275 17 19%
TOTAL 147152 33 23%*As per Dataquest
The IT Hardware Growth is estimated now in single digit in 2011-12
PC Market 2011-12... The bad news
MarketSize
2009-10
2010-11
GROWTH
2010-11GROWTH
2011-12Revised*
Desktops 5,526K 6,030K +9% -10%
Portables 2,508K 3,284K +31% +20%
TOTAL 8,034K 9,314K +16% +3%*As per MAIT revised Estimates
The PC/Laptop Market is almost flat in 2011-12 (Last 2 quarters are –ve)
2011-12 washed out for IT
Thailand FloodJapan Tsunami
3 Reasons
RupeeDevaluation
54.221%
Caused Supply line disruptions to entire
ecosystem
Profitability Declined badly
Opportunities for 2012-13... The MAIT Agenda
The Union Budget 2012-12 The need of the Hour
Growth Oriented
Investment Oriented
Reforms & Stability Oriented
7 recommended changes
1. Removal of Anomaly in Inverted Duty Structure & abolish 4% SAD2. Withdrawal of MRP Based Assessment for IT Products.3. Custom duty correction (eg. Lenses & Accessories)4. Abolish MAT and continuance of exemption benefits on Manf in nominated areas/schemes5. Correction on double taxation as goods & as services.6. Confirmation on GST Implementation timelines7. Clear guidelines on transfer pricing to eliminate ambiguity & bring transparency to enhance investors’ sentiments
MAIT Charter for 2012• 1. Launch of e-Waste Information
exchange Portal • 2. Expansion of membership to include
Recyclers, SI, SMEs, Channel Assn, IT Training & R&D Centres• 3. Introduction of 3 Specialized Vertical
Chapters.• Launch Green IT Chapter