Designed to completely transform India into a global design and manufacturing hub, the ‘Make in India’ initiative aims to increase the share of manufacturing in the country’s GDP from 16% to 25% by 2022. While every Indian company is naturally optimistic about the growth prospects, one Indian company which was set up with the objective of manufacturing IT products in India, is now reaping the benefits of a focused strategy. The company, Smartlink, which was set up by an IT veteran, K R Naik, with close to four decades of experience, is seeing huge growth for its low cost wireless broadband router, which offers Internet speed upto 300 megabytes per second.
The company’s legacy of local manufacturing dates back to a time when local manufacturing looked unfeasible. Local manufacturing has given the company a scope to design and manufacture products that are tailored to Indian operating conditions, which are different compared to other countries – be it how products get transported, how they are installed or under what power conditions they operate.
“Smartlink was set up with a vision to manufacture IT products in India for India. My IT journey started 4 decades back with mainframe computer development in the IBM days and I then entered in manufacturing personal computers about 3 decades back by importing wave soldering machine and subsequently we introduced SMT line to use
surface mount components with large scale manufacturing in Goa,” remembers KR Naik, Founder & Chairman, Smartlink Network Systems. Naik says that the Government’s clarion call for electronic manufacturing has helped in inspiring the entire electronic manufacturing industry.
Smartlink is accordingly gearing itself to reinvent complete chain of electronic hardware manufacturing starting from design to disposal (D&D). Today, Smartlink is engaged in the manufacturing of products such as routers, modems, networking switches, motherboards and access points.
The IT hardware manufacturing industry will have a major role to play in the country with Digital India initiatives announced by the Government. The 9 pillars under the digital India initiative are going to be a huge demand generator. Demand arising out of Digital India initiative coupled with the existing demand in the domestic market is a huge opportunity for the domestic manufacturing industry. The government has rightly realized this and they have announced policies in order to seize the opportunity.
“One of the important goals in the digital India initiative is targeting Net Zero imports. This can be achieved by reducing the imports and increasing exports. The strategic location of our country in proximity to the ever growing African & middle-east countries which the Indian manufactures can target for exports. Therefore there is huge potential for the Indian manufactures to go for economies of scale thereby achieving net zero imports. Further, increase in manufacturing activity is going to boost the local component manufacturing industry as there is a robust plastic and metal component industry existing which can immediately contribute to localization. Thereby a complete required value chain getting developed in the country in about 4 to 5 years period with over 70% of BOM localization taking place in India itself. This is going to further compliment the service sector not only creating huge employment opportunities for youth but also resulting into multiplier effect,” states Naik.
For accelerating the vision of ‘Make In India’, there are a number of small steps that the government could take. “The
Government of India should go for immediate import substitution and create duty differentials so as to attract domestic manufacturing as against trading of imported finished goods. Complex and adverse tax reforms are proving to be hurdles in the economic growth. Multiple states, multiple taxes, multiple agencies and disconnect between the central government and the state government is a major hurdle. Each state here is a country in its own way formulating its own laws, however India being a federal state has to thrive as one for economic prosperity,” says Nitin Kunkolienkar, VP, Smartlink Network Systems.
Kunkolienkar states that addressing hurdles by building synergy between the central and state government will certainly improve ease of doing business and bringing down the cost of doing business. Other policy announcements such as introduction of GST at the earliest in order to bring parity in the tax structure of the IT goods can also be a game changer for encouraging local manufacturing.