During a panel discussion moderated by CNBC-TV18, Krishnan noted that while demand for electronics remains robust, the software domain is witnessing a significant pivot towards artificial intelligence (AI) and cybersecurity services.
“The nature of demand is pivoting, and more of it is going towards AI-driven services,” Krishnan stated, illustrating a shift from traditional software solutions to niche areas that are increasingly critical in today’s digital economy. He acknowledged that concerns — driven by the AI boom — in the software sector are prevalent but reassured that the focus on advanced technologies is reshaping the market.
On the electronics front, Krishnan expressed confidence in the strength of domestic demand, particularly in the mobile sector, which constitutes approximately 40% of the electronics industry.
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“We manufacture practically all the mobile phones that we need in the country today,” he said, adding that this speaks to the efficacy of the production-linked incentive (PLI) schemes, which he said have been instrumental in boosting local manufacturing capabilities.
Krishnan also pointed out that the government aims for a significant output target of $500 billion for the electronics sector by 2030. This ambitious goal aligns with the broader vision of cultivating a trillion-dollar digital economy by the end of the decade. “A significant portion of what happens in electronics manufacture, including component manufacture, will also go towards export,” he explained, indicating that exports will be essential to integrate India into the global value chain.
Despite the optimistic outlook, Krishnan acknowledged the need for localising the component value chain to reduce reliance on imports. “Just because we are manufacturing more in India doesn’t mean imports necessarily come down unless more of the component value chain gets indigenised,” he noted. This strategy is crucial for positioning India as a competitive player in the global electronics market.
Krishnan also highlighted the ongoing interest in the semiconductor space and its ecosystem players, stating, “There’s a fair amount of interest, continuing interest, in various elements of components and also equipment manufacturers.”
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