Dalian and India Potential for Investment and ICT

Keynote Presentation By

NK Goyal, President CMAIChairman Emeritus, TEMA

Vice Chairman ITU APTChairman, ITPS Dubai

Member, Governing Board Telecom Equipment and Services Export Promotion Council (Govt. of India)

CISIS China International Software & Information Service Fair 2012 Dalian China, June 15th 2012

www.nkgoyals.com, www.cmai.asia

China recognizes the need for fast development of IT Industry and we are in second year of the China 12th 5 Year Plan

New 18th Policy of China, envisages to boost the growth of Software and IC Industry

CISIS Fair 2012 is recognized as Top IT Event in China

India and China Offers good scope for ICT development and cooperation

China-the growth Engine ICT

India China Trade

China is India’s largest trade Partner 2011 the bilateral trade between India

and China reached 73.9 Bn $ By 2011 end, Chinese companies

invested 555 $ in India and Indian Companies invested 447 $ in China

Target 100 Bn $ of Bilateral Trade by 2015

Dalian Government is giving high priority for ICT.

Rise of Asia presents tremendous opportunities for growth in this Century

India, China are two big markets

Huge Scope in several verticals…Health, Automobile, Aviations, Education, Banking, Commerce

Dalian Government and Indian Government coming with new policies to attract investment

Advantage Asia

• GDP crossed USD 1 Trillion Mark

• 4th largest economy in world when adjusted for purchasing power parity

• Growing well in excess of 8% per annum for last three years.

• USD 380 Billion Projected infrastructure investment in next 5 years• Over the next two years, India could attract FDI worth $ 80 billion• Large Domestic Market: - 560 million consumers in 20-49 age group expected by 2015 - 5th largest consumer market by 2025 - Increased disposable incomes & changing lifestyles

• Human capital: - Third largest pool of scientific & technical manpower (2,00,000 Engineering Gradates Annually) - Over 500 universities (20,000 colleges) - Large English speaking population

• GDP crossed USD 1 Trillion Mark

• 4th largest economy in world when adjusted for purchasing power parity

• Growing well in excess of 8% per annum for last three years.

• USD 380 Billion Projected infrastructure investment in next 5 years• Over the next two years, India could attract FDI worth $ 80 billion• Large Domestic Market: - 560 million consumers in 20-49 age group expected by 2015 - 5th largest consumer market by 2025 - Increased disposable incomes & changing lifestyles

• Human capital: - Third largest pool of scientific & technical manpower (2,00,000 Engineering Gradates Annually) - Over 500 universities (20,000 colleges) - Large English speaking population

Advantage India

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National Optical Fiber NetworkProvide broadband connectivity to panchayats so that banking and health services can be accessed online

US$ 4 Bil

US$ 1.2 Bil

US$ 4 Bil

National Knowledge NetworkInfrastructure project to connect educational and research institutes

National e-Governance PlanCountrywide infrastructure reaching down to remotest of villages; bringing public services closer to home

US$ 1.2 BilSet Top BoxDigital Addressable System (DAS) mandatory throughout country by December 2014

US$ 0.2 Bil LED productsDistribution of free LED lights to all BPL families ; Excise duty reduction on LED lamps and LEDs

India Govt. Procurement Projects

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Triad of Policies : IT, Telecom and Electronics

NPE Vision“To create a globally competitive electronics design and manufacturing

industry to meet the country's needs and serve the international market”

NPE Goals for 20201. Turnover of US$ 400 Bil;

• Chip design/ embedded software industry to US$ 55 Bil2. Investment opportunity US$ 100 Bil3. Includes over 50 initiatives to create an overall ecosystem to

make electronics manufacturing globally competitive.

India | National Policy on Electronics

8Cost of semiconductor design (US$ Mil, 2010)

As R&D costs in development of each new chip increase, India becomes the destination of choice for chip design and VLSI.

Projected semiconductor design market in 2020US$ 60-80 Bil

India | Semiconductors

Demand in 2010~ US$ 11 Bil

Projected demand 2020~ US$ 34 Bil

• Broadband on Demand by 2015, 600 Mil connection by 2020 at min. 2 Mbps speed

• National Optical Fibre Network (NOFN) : US$ 4 Bil project to provide broadband connectivity to 2,50,000 villages

• National Knowledge Network (NKN): US$ 1.2 Bil Infra project to connect educational and research institutes

• Total telephone subscribers ~ 950 Mil, tele density 77%

India |Telecom Equipment

• Cabinet has approved providing Digital Addressable System (DAS) throughout country by December 2014

• Tamil Nadu state government owned Arasu Cable TV Corporation floated tender for 2 Mil STB

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Projected Market for Set Top Box in next 5 years

200 Million units

India |Set Top Box

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• Value of electronics in automobiles ~ 20%-40%, increasing rapidly

• Centre of Excellence for development of automotive electronics in India

• Production of nearly 18 Mil Automotive vehicles in 2010-11

• Established automobile components hub

Market 2010 -11

~ US$ 30- 40 Bil

India |Automotive Electronics

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Example : Digital Hearing Aid

• Needed by 3-10% population in India

• Current price: US$ 300

• Target price : US$ 20-30

• Application Specific Integrated Circuit (ASIC) has been developed by CDAC Thiruvananthapuram

• Field trials currently going on

• Size of medical electronics equipment market by 2020 ~ US$ 5 Bil

• GoI committed to development of affordable medical electronic device industry

India |Medical Electronics

• India PC shipments increase in 2012 ~ 17%; world average ~ 4.4%

• Government aims to provide 1 tablet to every student under Aakash scheme

• State Government initiatives

• Free laptop to students in Tamil Nadu and Uttar Pradesh

• Other states coming up with similar schemes

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India |Computers

Demand in 2010< US$ 1 Bil

Projected demand 2020~ US$ 35 Bil

• Lower carbon emissions by 20-25% by 2020

• Distribution of free LED lights to all Below Poverty Line (BPL) families (20 Mil lights)

• Government initiatives :

• Excise duty reduced to 6% on LED lamps and LEDs

• SAD fully exempted on LEDs used for manufacture of LED Lamps

India |LED Market

• Electronic Development Fund

India |Govt. Initiatives

About CMAI CMAI prime Integrated Association of India representing all

verticals of ICE, telecom sector of India in India having more than 34 MOUs with International organizations, with branch offices in Japan, Korea, Singapore, Taiwan, China and Malaysia.

It offers one window service for information dissemination, guidance on setting up businesses in India.

It connects you to Industries, Government, Trade and business It is involved in policy formulations with Government and

other stake holders for Technology Innovations, Indigenous manufacturing

It is developing scientific knowledge and practical means for protecting human ecology and environment from the harmful effects of environmental hazards like e waste, radiation etc.

It assists manufacturers to maximize competitiveness in the domestic and international markets.

It also offers consultancy services on turn key basis through its member companies

CMAI Activities in China

Regular Delegation to Shenzhen, Beijing, Kunshan, Dalian, Shanghai, Quingdao etc.

In contact with Several Mayors and Vice Mayors and leaders Has promoted Bi-lateral trade between India and China for more

than ten years Organizing Int’l Mobile and electronic exhibition in China & India

for last seven years. Has three offices in Shenzhen and CMAI Offices in Shanghai,

Kunmin, Chengdu Regular key note speaker in CISIS, Dalian, China Trade in Services,

Bejing, Kunshan Computer and Electronics Fair, China Mobile Sourcing & Investment Fair, China International Mobile Science Tech Exhibition, Hongkong Guangdong Business Conference, India China Economic Conference, Electronics & Information Fair, Hangzhou, 2009, etc

CMAI MOU’S in China

CCIIP - China Council for International Investment Promotion

CCPIT- China Council for the Promotion of Intll. Trade

SIDA - Shenzhen Industrial Design Association, Shenzhen CECC - The China Electronic Chamber of Commerce DAIT - Dalian Association for Investment & Trade with

India, SMCA - Shenzhen Mobile Communications Association SEIA - Shenzhen Electronics Industry Association ICEC - Indo China Economic & Cultural Council Zhongrui – Zhongrui Exhibition Company. CME - Shanghai Kuozhan Exhibitioin Service Co. IMA- Internet Mobile Association

CMAI ICOMM 2012 7TH CMAI India International

Communications Fair 2012 Mobiles Tablets Consumer Electronics 14-15 September 2012 NSIC Expo Grounds | New Delhi | India The Biggest Buyer Sourcing Platform-One

to One Business Meetings Your Best Partner for Market Expansion,

Lead Generation in India’s Mobile Handset and Electronics Industry

Indian UID Project

India Govt. has started first of its kind project in the world Unique Identification Authority of India (UIDAI)

Over 10 $ Bn. projected investment in National ID and E Governance.

Under this unique identity number will be issued to 600 Mn. of Indian population by 2014.

Single identity paradigm would facilitate giving identity to citizens, enable tracking of end to end service delivery, subscription to new services, help tracking people related with security concerns.

This project offers tremendous opportunities for technology and products. 

Indian VAS Market SMS continues as world over highest revenue generator Ring tones and SMS account for large portion of VAS

market. About 8,00,000 ring tones downloaded daily In India Revenue from VAS presently is 10-14% of total

revenue, expected to grow 30% within next 5-7 years. VAS core component of operators revenue

High end users....video on demand, user generated content ie. interface between web and mobile

Long tail users, who focus on contents subsidized by ads.

Good scope for utility based services eg. Location information, M commerce etc.

Gaming coming up in big way. 30% of games download in Category B/C towns.

Mobile advertisement picking up. Global revenue from mobile advertisement expected to grow $ 10-20 Mill by 2011

The Indian mobile VAS) expected to reach US$ 5.8 Bn. by 2013, from US$ 2.0 Bn. in 2009. Currently,

IPv4 Migration to IPv6

India will also face problem of IPv4 addresses and the problem is worsening due to continuous addition of miles users, connected devices and start of 3G and Broadband Wireless Access services.

IPv4 allows 4.3 billion IP addresses whereas IPv6 will enable another 340 trillion, trillion, trillion addresses -- enough to accommodate global Internet demand for the foreseeable future.

India has taken a policy decision that all ISPs and telecom providers will have to be IPv6-compliant by the end of 2011. And by March 2012, all Central and State Government Ministries and public sector companies will make the switch to IPv6 Internet protocol based services.

 

Opportunities in Cloud Computing

The cloud computing market in India is expected to grow at a CAGR of 40 per cent by 2015 to Rs 11,200 Crores ( $3 Bn.) from an estimated $66.7 million in 2009, $ 500 Mn. In 2011 driven by cost and performance efficiencies

During the same period, the global revenues from cloud services will grow from $29 Bn. to over $70 Bn.

Some well know cloud services today are Google's search, Apple's iTunes, Amazon Web Services, Microsoft's Azure..

As compute loads grow 10 times, 100 times and even 1,000 times, there is need for new architectures for IT systems.

Other Web Based Technologies

In IT, the technology and the usage evolves faster even more than 10 times than any other industry. This means new business opportunities and old technology becoming obsolete.

The internet has grown from 10 million users to one billion users and up to three billion if we count Internet-enabled mobile phones too. The total connected devices today are about 5 Bn. likely to grow within few years to 1 Trillion.

The active websites have grown from 1 Mn. to more than 100 Mn.

SOCIAL NETWORKING India currently has 50 Mn. mobile web users. The growing

popularity of mobile social networking can also be attributed to youth. Youth being mobile savvy as well as enthusiastic users of social networking sites are setting the trend, attributing to the rise of social networking through mobiles.

Approximately 10 Mn. urban Indians used their mobile phones for engaging in social networking during quarter ending August, 2009, a reach of 3.3% among urban Indian mobile phone user. It also overtook China to take the 3rd place in the global mobile internet industry.

7 out of top 20 sites Indian internet users are visiting are in the arena of social media. 4 out of top 20 most visited sites in India are social networking sites. More than 70% people who are online are engaging with social media on some or the other platform.

Mobile Commerce and Social Commerce

About 7 per cent of the overall internet users in India are active on line shoppers. This is likely to grow to 25% in next three years with more mobile users and growing mobile commerce applications on use.

Social commerce is also expected to grow substantially as it could prove to be a key revenue model for social sites. This can be achieved either by creating a universal social currency or through social apps that will either help people transact or provide consumer feedback about a specific product or brand.

Fusion Cable Technologies Demand for access to media and communications on

any device has increased, cable operators have embraced innovative solutions that move beyond first-generation, triple-play services and seamlessly fuse communications and entertainment to meet demands for an integrated digital lifestyle and new social media interactions.

Multiparty, multimodal, multimedia services – or 'fused' services – blend high definition voice, video and data to create personalized entertainment services.

New emerging services and technologies required to provide fusion between communications services that allow users to communicate and share content in different ways, regardless of end-user device or access network type.

Global Mobile Handset Market

Over 2 Bn. people worldwide will own at least one smart phone in 2015, with unit sales growing over 175% from 2010. (Parks Associates )

Global mobile handset industry valued at appx $133bn in 2009 likely to grow at CAGR of 17.1% during 2009–14 to reach $293bn by 2014.

India and China largely driving growth of smart phones in Asia Pacific, which constituted 47% of total of 112 Mn. shipments during 2009. Likely to grow more than 50% by 2014 with total shipment forecasted 712 Mn.

Smart phones contributed 79 % of profits during 2009 even though market share was hardly 17%.

GGreat reat IIndian ndian OOpportunitypportunity

THANKSTHANKS

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