To get India onto a high and sustainable growth rate, the government and the private sector have to work in collaboration. To facilitate this partnership further, NITI Aayog organised an interactive two-day conference in August 2017, called the ‘Champions of Change’. The aim was to foster conversations between the private sector and the government, which included the prime minister.
During the conference, top CEOs from different sectors of industry deliberated over six different key themes—‘A New India by 2022’, ‘Make in India’, ‘Cities of Tomorrow’, ‘World Class Infrastructure’, ‘Doubling Farmer Incomes and Fixing Finance’, and ‘Reforming the Financial Sector’.
During the event, four main focus areas emerged on which the government needs to work as an enabler, with the private sector as the implementation agent. The areas are – conducive business environment (covering issues related to land, labour, capital and ease of doing business), logistics, infrastructure, and MSMEs and Industry 4.0 (innovation and disruptive technologies).
Vinod Sharma, managing director, Deki Electronics, was a member of the group that focused on ‘Make In India’. His inputs to the presentation were the challenge of tackling the ‘4Cs’ – cost, complexity, corruption and culture – that are holding back manufacturing in India. In a conversation with Baishakhi Dutta, senior business journalist at Electronics Bazaar, he shares his views on the conference and what it helped to achieve.
EB: How do you see Deki participating in the various collaborations between the government and the private sector?
The conference was called a B2G or business to government dialogue and discussion platform, and the purpose was to find ways to make ‘development’ a household theme. Prime Minister Modi is trying to create ‘champions of change’ in people like us, so that we spread the message of the development of India’s manufacturing to every household in the country. If everyone gets involved with promoting manufacturing, only then will this dream become a reality. It is good to spread the message and become the messenger but, at the same time, there are a lot of things that need to be done both by the government as well as the private sector in order to achieve our aspirations.
EB: Tell us about Deki’s action plan for tackling the 4Cs.
Honestly, these 4Cs cannot be handled by any enterprise on its own. Talking about Deki, what we can do is become far more productive and energy efficient. We try to benchmark ourselves against our counterparts in China and Korea. In terms of the quality of capacitors, we are better than them. But our cost factors (energy, finance and logistics) for manufacturing are double theirs.
At present, the competition is not between the companies. We are not competing against any company in China or Japan. We are competing against the entire ecosystem in these countries. This ecosystem includes machine makers, component makers, capacitor makers, etc. So the biggest problem lies with the ecosystem.
Today, certain Indian companies have survived so well because they have done something remarkably well. But, unfortunately, we have all stayed within the boundaries of a turnover of ₹ 500 million to ₹ 1 billion, while our Chinese counterparts have crossed that limit long ago.
EB: What are your expectations from this initiative?
All the ministers are doing their bit and have agreed to dig deeper, keeping in mind the PM’s initiative. We had a meeting with Piyush Goyal (former Minister of Power), Minister of Railways and Coal, and his team (comprising the coal secretary, the NTPC general manager, etc) recently, where he came up with some very good ideas that can be implemented. At the same meeting, the minister created five sub-groups —for example, one for dealing with regulations, another for solar and renewables, etc. The additional secretaries or the joint secretaries are heading these groups, and four or five people from the industry, like myself, are now talking to them and getting our message through.
EB: What challenges do you anticipate in your roadmap and how do you plan to overcome them?
Till now, we have not had a proper ecosystem. Even if there was an ecosystem at some stage, the vision was clearly missing. India is a democratic country and therefore everyone has the right to make anything they want.
In order to streamline our ecosystem in a holistic way, all the ministries need to work together. I think the starting point is to have joint-ministerial, all-sector discussions. E-vehicles is an opportunity in the market. We need a lot of power to run these e-vehicles. But unless there is a cross cutting group, the success of e-vehicles in India will be very limited.
The need of the hour is to have a clear agenda as to what we really want to achieve and then have all the stakeholders work together towards that goal, including the academicians (for we make a huge mistake by not involving the universities in any such decision making procedures)
EB: Can you give us some estimates of current and future growth rates with respect to manufacturing in India?
In my opinion, this event was held to spell out the enablers for manufacturing. The fact is that we have increased manufacturing in the country by 15-16 per cent, but we want to raise it up by 25 per cent by 2022. In that process, we intend to create a lot of jobs.
EB: What role will automation and IoT play in electronics manufacturing in India?
Needless to say, both will play big roles because a huge technology march is happening and no one can stop it. Industry is going through a massive change, and the SMEs have not understood this as yet. Of course, there are serious concerns as to how SMEs will be able to cope with the changes IoT will bring about in a developing country like India, because of certain reasons.
Our track record of SMEs adopting the latest technology is not very good, as we are all capital starved. Implementing these technologies will cost us a lot. Robots will slowly start eating into people’s jobs. So we need to figure out very smart ways of where to use automation, and where not to.
One of my biggest concerns is that if all these new manufacturing processes take a strong hold, the production centres will slowly move back to countries like the UK and USA. For, if one can produce goods without the help of labour, then why stay in India. Manufacturers would prefer venturing out to countries with better ecosystems.
EB: Talking about automation and IoT, how will Deki be a part of this move forward?
We are trying to use IoT to some extent. As far as AI is concerned, we have started taking baby steps for our production processes. We are trying to monitor all the machines every second, for breakdowns. We use visual inspection machines, with the help of which we monitor all the products each second. This is helping us tremendously to increase our productivity. We are viewing IoT as an opportunity.
EB: Please highlight the role of electronics in ‘A New India by 2022’.
No country is using technology as effectively as India for governance purposes and to reach out to people. We aim to create an e-marketplace for the betterment of the farmers. If we look at ‘Make in India’, electronics can make manufacturing of anything so much faster and more productive. The time has come for us to do something extraordinary. In the upcoming years, we really need to do a lot to help our country reach its potential in the field of electronics. We have so long talked about ‘Electronics for humanity’. I believe it’s time we start thinking along those lines very carefully and with commitment.