Magnetic

Maharashtra
Attractions Unlimited

www.midcindia.org

Maharashtra
Electronic System Design and
Manufacturing Sector (ESDM)
November 2014

Knowledge Partner

Magnetic
Maharashtra

Preface

Attractions Unlimited

The Maharashtra ESDM Sector Profile has been developed by Ernst & Young India LLP, the Knowledge Partner to Maharashtra Industrial Development
Corporation to provide hand holding assistance to investors.
The intention is to provide executives a quick overview to the ESDM Sector in the State.
The complex decision-making process involved in undertaking foreign operations requires an intimate knowledge of a countrys and a States commercial
climate as well as recognition of the fact that this climate is continuously evolving. Companies doing business in India, or planning to do so, would be welladvised to obtain current and detailed information from experienced professionals. The information presented in this book has been validated w.e.f
September 2014.

Knowledge Partner

Magnetic
Maharashtra

Macroeconomic Profile

Attractions Unlimited

- Economy

Maharashtra's GSDP in INR Lakh Crore

LEADER

Maharashtra has the

highest GSDP in
India INR 13.7 Lakh
Crore (USD 228.3
Billion)

8.43%

CAGR of GSDP at
constant prices over
the last 5 years

13.7
10.4
7.5

2008-09

12.0

8.6

2009-10

2010-11

2011-12

2012-13

The manufacturing sector contributes a significant 18.51 per cent to the states GSDP. Amongst the 10 states with the highest GSDP (Gross
State Domestic Product) in India, Maharashtra is one of the leading states in terms of contribution of manufacturing share to the GSDP.
Maharashtra has a Per Capita Income (PCI) of INR 1,07,670. The state has the highest per capita income amongst the 10 states with the highest
GSDP in India.

Magnetic
Maharashtra

Macroeconomic Profile

Attractions Unlimited

- Industry

Maharashtra's Industrial Output in INR Lakh Crore

LEADER

Highest Industrial
Output in the nation
INR 10.05 Lakh
Crore (USD 167.5
Billion)

17.41%

Maharashtras share
in Indias total
Industrial Output

10.05
7.85
5.20

2007-08

6.00

2008-09

6.24

2009-10

2010-11

2011-12

The state recorded the highest Industrial Value Addition in the nation. The Gross Value Added by all industries in the state amounted to INR 1,79,222
crore (USD 29.87 billion) in the year 2011-12, which is 59 per cent greater than the value addition of its closest follower.
Maharashtra has the second highest number of factories and has one of the lowest number of industrial disputes in the country.
4

Magnetic
Maharashtra

Macroeconomic Profile

Attractions Unlimited

- Investments

Maharashtra FDI Inflows in INR Crore

44,664

47,359
LEADER

Highest FDI Inflows

in the nation

One Third

Maharashtras share
in Indias FDI Inflows
over the period 2000
- 2014

27,669

2010-11

2011-12

2012-13

Maharashtra has attracted INR 3,16,082 crore of FDI over the period 2000- 2014, which is almost one-third of the nations total FDI inflows received
over the same period.
New investment projects announced in 2013-14 which would be set in Maharashtra are proposed to bring in INR 27,795 crore of investment in the state.
In 2013-14, the state contributed 10.86 per cent of the total projects completed in India in terms of investment value. With a total of INR 28,406 crore of
investment projects completed in the state, Maharashtra is one of the leading states in the country in terms of project completion (by investment value).

Infrastructure

Magnetic
Maharashtra
Attractions Unlimited

ROAD AND RAILWAYS

AIR AND WATER PORTS

More than 99 per cent of the villages are well connected with all
weather roads in the state
9.3 percent of total railway network in the country
2 Major Railway zones
Dry Ports, Inland Container Depots, Truck terminals and Railway
sidings for easy freight movement

LAND

ENERGY

Maharashtra is the second largest state in India, with an area of 30

Million Hectares (307,713 sq. km.)
MIDC has one of the largest land banks in India, with industrial land
spanning over 84,000 hectares

Gross installed capacity of power plants (excluding Central Sector) is

23726.7 MW. The state has the highest Gross installed capacity
(Utilities) at 10.62 per cent of the nations total installed capacity.
Gross Generation of power plants (excluding central sector) is at
77,169.9 million KwH

4 International and 7 Domestic Airports

6 MIDC airstrips
2 Major ports
22.45 per cent of the total cargo traffic of the major ports in India is
handled by the Jawaharlal Nehru Port (JNPT) and Mumbai Port
(MBPT)
53 Minor ports

Infrastructure

Magnetic
Maharashtra
Attractions Unlimited

To Madhya Pradesh

To Gujarat

Shirpur

Nagpur

Jalgaon
Amravati

Wardha

Akola
Nasik

Juhu

Yavatmal

Aurangabad

Ozhar
Sinnar

Shirdi

Gondia
Bhandara

Gadchiroli
Chandrapur

Jalna

National Highway
To Chhattisgarh

Dhule

To Madhya Pradesh

Railway
Airstrips
Domestic Airports

Thane
Mumbai Rajgurunagar
Raigarh

Ahmednagar
Beed
Latur

Pune
Baramati
Satara Phaltan

Dighi

Gangapur
Osmanabad
Solapur

Ratnagiri

International Airport

Nanded

To Telangana

Key Locations
Major Ports
Proposed Gas
Pipeline Network

Karad
Sangali

Kolhapur

To Telangana

To Karnataka

Sindhudurg

To Goa

To Goa

ESDM Sector
in India

Magnetic
Maharashtra
Attractions Unlimited

Indian ESDM Industry Revenues (INR Crore)

3.5

3.9

4.1

4.5

5.1

Indian ESDM industry revenues 2012 (by categories)

5.7
15%

1%

Electronic products
Electronic components

5%

Semiconductor design

79%
2010

2011

2012

2013

2014

2015

Electronics
manufacturing services

ESDM industry in India is estimated to have clocked revenues of INR 4 Lakh Crore (USD 68.3 billion) in 2012. The ESDM industry in the country is expected
to grow at a CAGR of 9.9 per cent from 2010 to 2015, to reach USD 94.2 billion. This is more than twice the growth rate of the global ESDM market.
Domestic revenues accounted for 70 per cent of the industry revenues in 2012 while exports accounted for the remaining 30 per cent. Most of the export
revenues are generated from the export of semiconductor design and electronic products while electronic components and electronic manufacturing services
constitute a small portion of the exports.

ESDM Sector
in Maharashtra

Magnetic
Maharashtra
Attractions Unlimited

Industrial Output of Maharashtra's ESDM Sector

17.06

17.52

20.30

13.82
10.11

2007-08

LEADER

2008-09

2009-10

2010-11

2011-12

Maharashtra has the

highest industrial
output in the
Computer,
Electronic and
Optical Products;
Electrical Equipment
manufacturing sector

*Gross Value of Output : Manufacture of Computer, Electronic and Optical Products; Electrical
Equipment

With a share of almost 20 per cent in Indias total, Maharashtra has the highest industrial output in the Computer, Electronic & Optical Products. Electrical
Equipment manufacturing sector.
The industrial output of the Computer, Electronic and Optical Products; Electrical Equipment manufacturing sector of Maharashtra has grown at a healthy
CAGR of 19.04 per cent over 2007-08 to 2011-12.
9

ESDM Hubs
In Maharashtra

Magnetic
Maharashtra
Attractions Unlimited

Pune
Pune is one of the most industrially developed districts in
India.
Punes strong educational infrastructure has earned it the
name of Oxford of the East and an abundant availability of
skilled labor has attracted many electronic manufacturing
companies.

KHED, PUNE

Punes excellent connectivity to the two of Indias largest

ports JNPT and MBPT has facilitated the district to
become an export hub for electronic manufacturing
companies.

TALEGAON, PUNE

ESDM HUBS

Talegaon and Khed are the two ESDM hubs in Pune. Factors
such as locational advantage, connectivity and industrial
infrastructure have made these locations hot spots for
electronic manufacturing companies.

10

Key Growth Drivers

Magnetic
Maharashtra
Attractions Unlimited

Dedicated Clusters

Policy Support

Strategic Location

Educational
Infrastructure

Skilled Labor

Supplier / Vendor
Base

Strong Domestic
Market

ESDM
Sector in
Maharashtra

Access to Foreign
Markets

Maharashtras top notch educational institutions have facilitated the state to become an R&D hub for the ESDM sector. Moreover, Availability of low cost
skilled labor has driven companies to establish their global manufacturing hubs in the state and export their products overseas.
India currently imports more than half of its requirement for electronic equipment. Maharashtras developed industrial infrastructure, a large supplier / vendor
base and an excellent inter state connectivity has attracted investments from many companies that aim to tap the nations growing demand for electronic
equipment.
11

Human Capital

Magnetic
Maharashtra
Attractions Unlimited

SKILLED WORKFORCE
The state has a literacy rate of 82.34 per cent with a large base of
skilled and industrial labour.
The state has a total of 2298 technical institutions with an intake
capacity of 4,49,121. It also houses 781 ITIs (Industrial Training
institutes) with an intake capacity of 1,17,747.
There are 20 universities in the State of which four are agriculture
universities, one university for health science course, one university for
veterinary science, one for technology and 13 other general
universities.
In addition to these, there are 21 deemed universities in the State.
The state is home to some of the most reputed national R&D
institutes, viz., the Centre for Development of Advanced Computing
(C-DAC), the Bhabha Atomic Research Centre, the National
Environmental Engineering Research Institute, the National Chemical
Laboratories and the Tata Institute of Fundamental Research. One of
the well-known Indian Institutes of Technology (IITs) is located in
Mumbai.
Pune is also an important education hub of India, often referred to as
the Oxford of the East.

DEDICATED INSTITUTIONS
Table: Technical Educational Institutions in Maharashtra (2013-14)

Type of
Institutions

No. of
institutions

Intake
capacity

Enrolment

Engineering

1074

3,45,343

6,20,946

Master in
computer
application

148

13,385

23,614

Management
science

516

57,392

27,689

70 new Engineering colleges have been established in Maharashtra in

the last year.
15 new Industrial Training Institutes (ITIs) have been established in the
state in the last year.

12

Policy Support

Magnetic
Maharashtra
Attractions Unlimited

Maharashtra Industrial Policy 2013-18

FISCAL INCENTIVE BASKET
Technology
Upgradation Subsidy

Stamp Duty
Exemption

Interest Subsidy

Cleaner Production
Incentives

Water Energy
Subsidy

Water conservation
Incentives

VAT + CST
Abatement

Electricity Duty
Exemption

Royalty Exemption

DETERMINING FACTORS

Fixed Capital Investment

Employment

Location

Under the state's new Industrial Policy 2013, Mega and Ultra Mega projects can qualify for fiscal incentives upto 100 per cent of the fixed capital investment.
Moreover, a 10 per cent additional incentive on top of the above incentives is provided by the state if the project creates double the employment required
for the eligibility.
In February 2014, the Indian government approved setting up of two semiconductor units by two consortia one led by Jaiprakash Associates and the other
by Hindustan Semiconductor, entailing investments of INR 51,550 crore. The cabinet also approved that incentives that will be made available to the above
13
consortia, will also be extended to other players who show interest in setting up of similar semiconductor plants.

Policy Support

Magnetic
Maharashtra

Electronic Manufacturing Clusters Under M-SIPS

Attractions Unlimited

Seven electronics manufacturing clusters have been notified by

the Government of India, in the state of Maharashtra.
NAGPUR
AURANGABAD

THANE

The scheme aims to promote large-scale manufacturing and

provides following incentives:
Capex subsidy of 25 per cent in non-SEZ and 20 per cent
within SEZ

MUMBAI
NAVI
MUMBAI

All units within these clusters will be eligible for benefits under
the Modified Special Incentive Package Scheme (M-SIPS).

PUNE

Reimbursement of CVD/excise for capital equipment for

non-SEZ units
Reimbursement of central taxes and duties for 10 years in
select high- tech units like fabs (semiconductor
manufacturing plants)

NASHIK

ELECTRONICS
MANUFACTURING
CLUSTER

The above incentives are available for units all across the value
chain starting from raw materials including assembly, testing,
packaging and accessories and covering all the 29 verticals of
ESDM products.
14

Key Players

Magnetic
Maharashtra
Attractions Unlimited

Videocon

Sterlite

Portescap India

LG Electronics

PG Electroplast

Godrej & Boyce Mfg. Ltd

Transasia Bio-Medicals

Epitome Components

Trend Electronics

Finolex

Bajaj

Schnider Electronic

Epcos India

Tata Consultancy Services

Reliance Industries

Shreem Electric Ltd

Honeywell

Qualcomm

Applied Micro

15

Growth Stories

Magnetic
Maharashtra
Attractions Unlimited

HONEYWELL INDIA
Honeywell has a significant presence in Maharashtra with its
automation and turbocharger manufacturing facilities based in Pune,
built with an investment of around INR 500 crore. This facility
provides full time employment to nearly 3,000 people in the state,
besides indirect employment and livelihood generation through
ancillary industries.
HAIL's production facility at Pune is among the few certified not just
by Honeywell but also by several government and defense
establishments. HAILs facility also a dedicated export facility under
Electronic Hardware Technology Park (EHTP).
In August 2014, Honeywell announced the launch of its
manufacturing facility in Pune, Maharashtra. This 75,000 sq. ft. stateof-the-art facility for Honeywell Automation India Limited (HAIL)
will significantly expand Honeywells manufacturing capabilities in the
country.
The new facility will integrate manufacturing, factory testing, quality
control and advanced manufacturing engineering for Honeywells
automation business in India.

Thomas A. Szlosek, Senior Vice President and CFO of Honeywell

International inaugurating Honeywells seventh manufacturing facility in Pune

Consolidating manufacturing in one

location will create efficiencies and improve

productivity for us
Vikas Chadha, Managing Director, HAIL on Honeywell's
second facility in Pune (Maharashtra)

16

Contact Us

Magnetic
Maharashtra
Attractions Unlimited

Shri. Bhushan Gagrani (IAS)

Dr. P. Anbalagan (IAS)

Chief Executive Officer - MIDC

Tel : 022-26870800, 22616547
Fax No : 022-26871587
Email : ceo@midcindia.org

Joint Chief Executive Officer - MIDC

Tel : 022-26871462
Fax : 022-26870026
Email: jtceo@midcindia.org

Shri.Yuvraj Poman

Head Office

Dy. Chief Executive Officer - II

Tel : 022-26870142 ; Fax : 022-26871604
Email: yuvrajpoman@midcindia.org

Maharashtra Industrial Development Corporation

Udyog Sarathi, Mahakali Caves Road,
Andheri(E), Mumbai-400 093

26-8-2014

Disclaimer
Maharashtra Industrial Development Corporation (MIDC) has engaged Ernst & Young LLP. (EY) to prepare this document and the same has been prepared by EY in consultation with MIDC. This document is for information purposes only. While due care has been taken
during the compilation of this document to ensure that the information is accurate to the best of EY knowledge and belief, the content is not to be construed in any manner whatsoever as a substitute for professional advice.
EY does not assume any liability or responsibility to any person for the outcome of decisions taken by such person as a result of any reliance placed on this presentation. EY shall not be liable for any direct or indirect damages that may arise due to any act or omission on the
part of the user due to any reliance placed or guidance taken from any portion of this presentation.
2014
All rights reserved. All copyright in this presentation and related works is solely and exclusively owned by MIDC and Ernst & Young. The same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any medium by electronic
means and whether or not transiently or incidentally to some other use of this presentation), modified or in any manner communicated to any third party except with the written approval of MIDC.

17