Ajai Chowdhry, Founder of Electronics Products Innovation Consortium and Co-Founder of HCL, emphasizes the need for significant improvements in India’s air logistics to bolster the nation’s ambitions of becoming a hub for electronics and semiconductor manufacturing. While lauding the Government of India’s Gati Shakti as a step in the right direction, Chowdhry underlines the urgency for comprehensive enhancements in both inward and outward logistics.
India’s vision of becoming a global player in electronics and semiconductor manufacturing hinges on resolving issues related to ease of doing business and streamlining logistics, as stated by Chowdhry in an exclusive conversation with Business Today. He points out that while the Gati Shakti initiative can be beneficial, more extensive efforts are required to expedite the inward and outward logistics processes.
Chowdhry draws attention to the intricacies of the electronics manufacturing supply chain, where components often need to be sourced from multiple countries. The efficiency of logistics plays a critical role in ensuring that these components reach India swiftly and seamlessly. Drawing inspiration from Taiwan and Vietnam, he highlights the importance of achieving a rapid turnaround from the arrival of components to the shipment of finished products, a pace essential for the dynamic electronics industry.
In his role within NITI Aayog’s program for electronics, telecom, and auto, Chowdhry emphasizes the necessity of integrating India into the global value chain (GVCs) effectively. Discussions within NITI Aayog have also centered around the pressing need to enhance logistics, especially in the electronics sector.
One key issue highlighted by Chowdhry is the reliance on air cargo for electronics components, which account for 80 to 90% of logistics in the industry. The shortage of large air cargo planes poses a significant challenge that needs immediate attention. As the industry gears up for the incorporation of electronic components in electric vehicles (EVs), Chowdhry stresses the vital role of air logistics in shaping the future of electronics and telecom manufacturing in India.
Apart from logistics, Chowdhry suggests that the government should focus on reducing the cost and time associated with inward logistics. This can be achieved by encouraging the establishment of a greater number of component warehouses within India, strategically located in key electronics manufacturing hubs.
Until significant progress is made in improving inward and outward logistics, Chowdhry advocates the establishment of warehouses in crucial locations such as Noida, Chennai, Bengaluru, and Hyderabad. This interim solution can mitigate challenges and pave the way for a more streamlined and efficient electronics manufacturing ecosystem in the country.
