Electronics Manufacturing in India

Image Source - EFY Group

A paper titled "Globalize to Localize: Exporting at Scale and Deepening the Ecosystem are Vital to Higher Domestic Value Addition" was recently released by the government.

Highlights

ICRIER (India Council for Research on International Economic Relations) and India Cellular and Electronics Association collaborated on the report's creation (ICEA)

Significance:

• This study outlines India's strategy for the upcoming few years.
• It examines how India might reach its goals of $300 billion in electronics output and US$120 billion in exports by 2025 or 2026.
• The report's release will assist the government in determining the obstacles to be overcome and the approaches to take in order to meet this goal.
• Exports and the percentage of domestic value addition are correlated
• The empirical relationship between exports and the percentage of domestic value addition in prosperous exporting countries is examined in the paper.
• It reveals that the two variables have a short-term negative connection but a medium-term positive correlation.

Electronics Sector in India

• India's reliance on imported electronics increased in 2014.
• Current Situation: With 16 billion dollars in exports in FY 2021–2022 and a target of 21–25 billion dollars in exports the following year, India is currently a 76 billion dollar manufacturing economy.
• This year, the industry of electronics has increased to rank as India's sixth-largest export.
• The single largest portion of India's electronics exports is mobile phones.
• By the following year, they are anticipated to account for close to 50% of all electronics exports.
• Targets: India has set a clear target of 300 billion dollars in manufacturing and 120 billion dollars in exports by 2026.
• The goal is to become a trustworthy and dependable partner in global value chains.
• In order to make India more robust to supply chain disruptions, the government has consistently emphasised the need to enhance the country's domestic manufacturing environment.
• The expansion and strengthening of the electronics ecosystem are discussed in that approach.

Challenges in Electronics Sector

• Highest tariffs: When compared to other electronics centres like China and Vietnam, India has the highest levies on the import of components for electronic devices.
• India doesn't have a strong ecosystem of businesses producing the components needed for electrical devices locally.
• High import costs: Importing these components at a high cost is cited as a problem.
• Less advantageous subsidy: In areas like manufacturing machinery and R&D, Vietnam and China have more favourable subsidy regimes than India does.
• Taxation: India offers fewer income tax deductions and reductions to electronics makers than China and Vietnam do.
• Another issue facing the sector is the absence of free trade agreements with wealthy nations.

Suggestions in Report

Domestic marketplace for competition:

• India must act quickly to develop a competitive local ecosystem of auxiliary suppliers through industrial development programmes, sourcing fairs, and technological upgradation initiatives.

Emphasis on exports

• In addition to local production, suppliers, and consumption, exports are a crucial means of gaining access to the scales of the other economies with which we compete.
• Exports will have a domino effect on the supply chain, generating investments and supply chain interests that will boost value addition in the Indian electronics market.
• Electronics value chains are undergoing profound, irreversible upheaval in the wake of COVID.

Opportunities for India

• India is given the opportunity and current momentum.
• India has to export more products to catch up in the electronics manufacturing industry.

Adopt global measures.

• China and Vietnam follow the adage "first globalize, then localise," which indicates that in the early years, they were focused on reaching a global scale in exports, before changing their focus to place more of an emphasis on local content.
• The paper suggests a methodical strategy that might align India's export growth with that of China and Vietnam.
• The first step should be to export in large quantities to international markets (globalize), and the next step should be to enhance the proportion of local content (localize).

The significance of policies

• The paper makes various recommendations for measures and regulations necessary to develop India's larger electronics ecosystem.
• In addition, programs like Gati Shakti will help boost India's competitiveness.

Government Initiatives

• India used the Phased Manufacturing Program (PMP) as a starting point to create a mobile sector worth USD 36 billion.
• By methodically constructing a structure and strategy, India has been successful in outlining its objectives, which include having a $300 billion electronics manufacturing ecosystem with US$120 billion in exports by 2026.
• India is currently seeking $300 billion in total production and worldwide exports via Production Linked Incentives (PLI).
• The administration is developing measures that will boost domestic value addition over the next few years with exports as its main goal.

Way forward

• The development of a strong local component ecosystem and a strong local supply chain should be prioritised.
• In order to make Indian manufacturing resilient and competitive on a global scale, the issues relating to infrastructure, tariffs, and Free Trade Agreements must be handled.
• It is essential that the Indian electronics manufacturing sector makes optimum use of its resources and develops long-lasting indigenous capabilities.

About Indian Council for Research on International Economic Relations (ICRIER)

• Founded in August of 1981
• ICRIER is a non-profit, economic policy-focused think organization.

Main goal:

• To improve the link between India's policymakers and the global economy while also increasing the knowledge content of policymaking through the conduct of analytical research.
• Stakeholders: Prominent academics, decision-makers, and business executives make up the Board of Governors of ICRIER.

Five areas of focus:

• Trade, Investment, and External Relations (TIER),
• Growth, Employment, and Macroeconomics (GEM),
• Agriculture Policy, Sustainability, and Innovation (APSI)
• Startups, the digital economy, and innovation (DESI)
• Sustainability, urbanisation, and climate change (CCUS)

Also, Read - The cyber threat to Digital/Mobile banking

The cyber threat to Digital/Mobile banking

Image Source - The Hindu

• Recently, the Asia Pacific area has seen an uptick in cyberattacks on Android and iOS devices, according to global cybersecurity firm Kaspersky.
• A recent study found that more consumers are gravitating toward digital payments and that an increasing number of people are using their cell phones to engage with their banks or bank accounts.
• Additionally, this acceleration introduces a vulnerability: a rise in the risk of cyberattacks on mobile devices.

Recent survey

• Two-thirds of respondents in a 2020 Statista poll of 5,000+ households in 25 States in India claimed they owned a smartphone.
• Of those, 50% claimed to send and receive money digitally, while roughly 31% claimed to have a banking mobile app.
• Nearly 14% of respondents claimed to conduct banking-related activities on their smartphones.
• This number increased even more as more people began using digital payment methods in place of cash transactions as a result of the COVID-19 pandemic.
• This acceleration brings along with it vulnerability: an increased threat of cyberattacks on mobile devices

The necessity for cybersecurity in online banking

Safeguarding the assets of the client

• The protection of customers' assets is the main goal of cybersecurity in digital banking. More and more activities or transactions are being done online as more individuals go cashless.

Recovering the information or data

• Cybercrimes in digital banking have an impact on both the customer and the institutions as they work to recover the data. For the banks to be able to retrieve the data or information, significant financial outlay may be necessary.

Trust

• Banks must have good cybersecurity because data breaches may make it difficult for people to trust financial institutions. It may pose major consequences for banks

Issues of Cyber Threats on Mobile Banking

Rising Cyber Attacks:

• A report by the cyber security company Kaspersky warns that as more individuals in the Asia Pacific (APAC) region convert to mobile banking, there will be an increase in cyberattacks on Android and iOS devices.

Trojan and malware usage

• Kaspersky claims that mobile banking Trojans are harmful viruses that can steal money from the bank accounts of mobile users by impersonating a trustworthy app to trick unwary users into installing the infection.
• For instance, the Anubis mobile banking malware has been primarily focusing on Android users since 2017.
• Additionally, its global ads have affected customers in Colombia, France, Germany, the United States, Denmark, and Vietnam.

Methodology:

• The attackers infect the device via high-ranking, legitimate-app-looking malicious Google Play apps, SMS smishing (phishing), and the BianLian malware, a different mobile banking trojan. Another common spyware that targets users of mobile banking is the Trojan, Roaming Mantis.
• The organization uses smishing exploits to take over domain name systems (DNS) and use them to attack Android devices and propagate malicious programs.

The issue with interoperability:

• As a result of changes in customer behaviour, many payment platforms, including Google Pay, Paytm, PhonePe, Square, PayPal, and Alipay, have benefited from the adoption of mobile banking.
• They've also permanently altered the payments game to their benefit as a result.
• These platforms work in a closed-loop payment environment where a Google Pay user can only transfer funds to another bank account through the search giant's payment service.
• In that they only permit financial transactions to take place within their respective networks and not between one another, Visa and Mastercard operate similarly.

Alteration of Business Model:

• Regulators who want open, standardized platforms with reduced entry barriers are contributing factors.
• Payment platform companies are already being forced by several nations to alter their business models.
• For instance, China has mandated that its internet service providers provide connection and payment services to rival companies on its platforms.
• A new regulation in India mandates that interoperability across wallets be available on all certified mobile payment services.

Lack of Security Professionals:

• The lack of technology, engineering, data, and security experts that banks need to realize their digital objectives tends to conceal a far larger issue, namely that banks are no longer the top employers for all types of talent.

Lack of Proper Cybersecurity Policy:

• The scarcity of skills in banking and the lack of adequate cybersecurity could result in an increase in cyberattacks on consumer devices.
• It also helps to be careful and extremely cautious when using a mobile device to make payments until this mismatch is fixed.

Threats for Cybersecurity in Digital Banking

Data not encrypted

• One of the most frequent hazards facing banks involves data that is left unencrypted and immediately used by hackers or other cybercriminals, causing serious problems for the financial institution.

Malware

• Digital transactions are typically carried out on end-to-end consumer devices like computers and smartphones, so they must be secured.

Auxiliary services

• To better serve their customers, many banks and financial institutions rely on third-party services from other suppliers. However, the bank that hired these companies will suffer greatly if they don't have strict cybersecurity measures

Spoofing

• When a user submits their login information, the criminals steal it and use it later. The cybercriminals will pose as a banking website's URL with a website that is identical to the actual one and performs in the same way.

Phishing

• Phishing is the practice of posing as a reliable entity in an electronic conversation in an effort to obtain sensitive information, such as credit card numbers, for harmful purposes.

Data

Which nation employs the most online bankers?

• Brazil will lead the way for digital bankers in 2022, according to a poll, where 43% of respondents said they have an account.
• Brazil is followed by Mexico (17%), Spain (17%), United Arab Emirates (19%), India (26%), Ireland (22%), Singapore (21%), Hong Kong (20%), United Kingdom (20%), and South Africa (15%).
• By 2027, a rise is anticipated in all nations.
• Within the next five years, 34% of individuals worldwide will have digital bank accounts, up from an average of just 19% in 2022.
• highest adoption rates among younger folks
• The age range in Brazil where people are most likely to have a digital bank account is 25-34 (55%), followed by 18-24 in Malaysia (20%), 35-44 in the Philippines (16%), 25-34 in Ireland (34%), 18-24 in Mexico (22%), 35-44 in Hong Kong (23%), 18-24 in Singapore (39%), 18-24 in the United Arab Emirates (31%), 35-44 in Germany (17%), 18-24 in Spain (22%), 18-24 in South Africa (18%), 18-24 in India (33%)

Women vs. Men

• With 29% of men and 23% of women reporting having a digital bank account, males are more likely than women to have one.

Way Forward

Comprehensive Security

• It is better to go toward integrated security, where all elements cooperate and communicate.

Analytics using big data and machine learning

• Leveraging analytics is crucial for maximizing cyber resistance. A new generation of real-time security analytics has been developed that can store and analyze a vast amount of security data.

Recognize the significance of security

• Security needs to be viewed as a benefit rather than a cost in people's perceptions. Only after considering the danger of security threats and their effects can the value of security be fully appreciated.

Spend money on next-generation endpoint security.

• Banks and other financial institutions need to spend money on technology that can identify and stop exploits.

Safeguard information

• Since sensitive data is now kept on several devices and in the cloud, every system that contains it needs to be secured.

Consumer Sensitivity

• The client must be made aware of the importance of keeping their banking credentials private in this crucial area.

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Community Forest Resource Rights

• The Mungeli district of Chhattisgarh has granted community forest resource rights to residents in four villages (CFRR).
• Following Udanti Sitanadi Tiger Reserve in the Dhamtari district, Achanakmar became the second tiger reserve in Chhattisgarh to receive CFRR.

About Community Forest Resource

Image Source - Sharbendu

• Common forest land that has traditionally been preserved and safeguarded for a specific community's sustainable usage is known as a Community Forest Resource (CFR) area.
• The community uses it to access resources that are located within the village's traditional and customary boundaries as well as for pastoralist communities' seasonal use of the terrain.
• Each CFR region has a traditional boundary that includes recognisable sights that are known to the locals and to the villages around.
• Any type of forest may be included, including revenue forests, classified and unclassified forests, considered forests, DLC (District Level Committee) lands, reserve forests, protected forests, sanctuaries, and national parks, among others.

About Community Forest Resource Rights

• The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (commonly known as the Forest Rights Act) recognizes the right to "guard, regenerate or conserve or manage" the communal forest resource. This right is outlined in Section 3(1)(i).
• CFR rights, in conjunction with Community Rights (CRs) under Sections 3(1)(b) and 3(1)(c), which include nistar rights and rights over non-timber forest products, ensure the community's ability to develop rules for the use of the forest by itself and others and fulfil its obligations under Section 5 of the FRA.
• Once CFRR is acknowledged by a community, ownership of the forest shifts from the forest department to the Gram Sabha.
• The Gram Sabha effectively takes on the role of the central administration for forest management.
• These rights allow the Gram Sabha the power to adopt regional customs for forest management and conservation inside the community's forest resource border.
• Kanger Ghati National Park is the only national park in which Chhattisgarh has recognized CFR rights, making it the second state to do so.
• The Simlipal National Park's Community Forest Resources (CFRs) was first acknowledged by the Odisha government in 2016 as a separate entity.

Significance of CFR

• The FRA went into effect in 2008 with the intention of redressing the "historic injustice" meted out to communities dependent on forests due to the restriction of their customary rights over forests.
• It is significant because it affirms the community's legal ownership of the forest land that these groups have long used for farming and habitation as well as their right to use, manage, and maintain its resources.
• Additionally, it emphasizes how crucial forest inhabitants are to maintaining forests and preserving biodiversity.
• It has more significance in protected forests like national parks, sanctuaries, and tiger reserves because locals there use their traditional knowledge to manage the protected woods.

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Abhijeet Sen

Abhijit Sen, a well-known economist and former member of the Planning commission, just passed away.

About Abhijeet Sen

• He served as a previous member of the Indian Planning Commission and was a well-known agricultural economist (from 2004 to 2014, PC disbanded in 2014).
• Prior to joining the Centre for Economic Studies and Planning at Jawaharlal Nehru University in 1985, he taught economics at Sussex, Oxford, Cambridge, and Essex.

Principal Contributions:

• He was given the responsibility of recommending support prices for agricultural commodities when he was made head of the Commission on Agricultural Cost and Prices (CACP) in 1997.
• He was the author of the High-Level Committee on Long-Term Grain Policy's report from July 2000, which advocated fixing MSP based on all cultivation expenditures that were paid out in cash and in kind.
• The "Swaminathan formula," which advocated that MSPs for crops be at least 50% higher than the cost of production, later incorporated this formulation.
• He had also advocated eliminating the "below poverty line" and "above poverty line" classifications in favour of a universal public distribution system with uniform central issue prices for rice and wheat.
• The National Food Security Act of 2013 made use of this under the UPA government, which was governed by Congress.
• In addition, he provided input for the Tendulkar Committee's report on poverty lines.
• He bemoaned "mechanical mining of the soil" and a decline in organic carbon content in 2017.

Supporter of decentralized governance:

• He vowed to increase state autonomy while also strengthening Panchayati Raj Institutions.
• Rashtriya Krishi Vikas Yojana (RKVY), which Abhijit sen conceptualised as a member of the Planning Commission in 2007, is an example of autonomy for the States.

Awarded for Public Service:

• He received the Padma Bhushan in 2010 for his contributions to society.

About Commission of Agricultural Cost and Prices

• It is an associated office of the Indian government's Ministry of Agriculture and Farmers Welfare. In January 1965, it was created.
• Determines the Minimum Support Prices (MSPs) by taking numerous aspects into account (like demand and supply, cost of production, intercrop parity, etc).
• Currently, the Commission is made up of a Chairman, Member Secretary, one Official Member, and two Members (Non-Official).
• Recommends to the Cabinet Committee on Economic Affairs the MSPs for the notified Kharif and Rabi crops (CCEA). The Government is not required to follow its recommendations.
• Currently, CACP recommends MSPs for 23 different commodities, including 7 different kinds of cereal (paddy, wheat, maize, sorghum, pearl millet, barley, and ragi), 5 different pulses (gramme, tur, moong, urad), 7 different oilseeds (groundnut, rapeseed-mustard, soybean, sesamum, sunflower, safflower, and nigerseed), and 4 different commercials (copra, sugarcane, cotton and raw jute).
• Every year, the CACP submits Price Policy Reports with its recommendations to the government, one for each of the five classes of commodities it covers: Kharif crops, Rabi crops, Sugarcane, Raw Jute, and Copra.

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PARAKH

The establishment of a national regulator called PARAKH (Performance Assessment, Review, and Analysis of Knowledge for Holistic Development) by the Union government is intended to create a benchmark framework for evaluating secondary and higher secondary pupils.

The National Education Policy (NEP) 2020 includes PARAKH.

Image Source - Youtube

About parakh

• The National Achievement Survey (NAS) and State Achievement Surveys are two examples of periodic learning outcome examinations that will be administered by the planned regulator, which will also serve as a constituent unit of the NCERT.
• Leading assessment professionals with in-depth knowledge of the educational systems in India and around the world will make up its team.
• With a mandate to support learning assessment in all forms, both nationally and, where appropriate, internationally, it will eventually become the country's one-stop shop for all assessment-related information and expertise.
• According to the National Education Policy (NEP) 2020, it will try to stop emphasizing rote learning.
• For all recognized school boards in India, it would "establish norms, criteria, and recommendations for student assessment and evaluation, encouraging and assisting school boards to move their assessment patterns toward fulfilling the skill requirements of the 21st century."
• Leading evaluation professionals with in-depth knowledge of the educational systems in India and abroad will make up the PARAKH team.

Objectives

Setting uniform criteria and principles for student assessment and evaluation across all authorized Indian school boards,

Improve the assessment process:

• It will encourage and support school boards in changing their assessment practices to match the 21st-century skill requirements.
• Reduce Evaluation Disparity: It will bring consistency across the state and central boards, which currently use diverse standards of evaluation and produce significant score differences.
• Benchmark Assessment: As envisioned by the National Education Policy (NEP) 2020, the benchmark assessment framework aims to do away with the emphasis on rote learning.

Suggestions

• Standardized Procedures & Rules: Hold Board Exams Twice
• The NEP's proposal to conduct board tests twice a year, including one to help students improve their scores, has received support from a number of states.
• Two kinds of math exams: States have also agreed on the idea of offering two different mathematics exams: one to measure basic proficiency and the other to measure higher-level proficiency.

Significance

• Reduce Fear: This will increase learning among pupils and lessen their fear of math.
• It would assist in addressing the issue of some state board students being at a disadvantage during college admissions when compared to their classmates in CBSE schools.
• Innovative Evaluation: It will create and put into practise technical standards for test design, administration, scoring, and reporting at all levels of schooling.

Way Forward

• PAREKH aims to facilitate an inclusive, participatory, and holistic approach to education that takes into account field experiences, empirical research, stakeholder feedback, as well as lessons learned from best practices. It also levels the playing field and reduces disparity among various state boards.
• It is a gradual turn toward a more scientific method of teaching.
• The recommended structure will aid in accommodating the child's abilities, including phases of cognitive growth and social and physical awareness.

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