Recent Tariff Rationalisation Will Fuel Exports Of Electronics: MeitY Secy

At a recent IESA summit, you brought up the topic of India-based IP for semiconductor companies. If you could elaborate on your vision for this?
If you look at the whole semiconductor manufacturing ecosystem in the Indian context, an important chunk of it relates to design. We have large human resources working on design. We have both design engineers and startups, and both of them work for some other large company or brand that takes the product IP. Then, this workforce, either as employees or under an outsourcing agreement, designs it. There are a lot of reasons for it - building a brand has a cost, there is a risk of it failing, and so on. Hence, it is much easier to manufacture for somebody else. So my point is that why don’t we create some products and make them available for others? Most of our IT companies offer software services, they don’t create a product. This will not happen overnight, but a start is needed.

Best selling author Chris Miller recently talked about how taking China head-on isn’t the best strategy when it comes to chip manufacturing. How do you read this statement?
Again, it has to be seen in context. If we are relocating an industry into India and if India is one part of this diversification of the value chain, then how much of it can be done by completely cutting out China? Even a Taiwanese company, a Korean company or an American company that has a manufacturing base in China, when they have to diversify away from China, what they will do is uproot from there and come and establish somewhere else in India or Vietnam. But again you would need people from China to reestablish at the new location because that is where the manufacturing has been taking place and you need materials, facilities etc. 

So, even if you are going to move across national borders, you have to ensure that there is movement to the jurisdictions that are trusted. It has to be a very nuanced approach; in the process of transition, we will need to collaborate with a wide range of stakeholders.

How is MeitY looking at the regulatory and ethical aspects of technologies such as AI and Quantum Computing? Deepfakes seem to be an immediate problem to address. Can we expect substantial steps from the government to curb it?
The AI debate has brought the realisation that misrepresentation is real, especially for democratic societies. My personal opinion is that the law as it stands today can be used to curb some of these things. Deep fakes are also nothing but misrepresentation. The only difference is that it is much more sophisticated and more difficult to detect as better technology is used. What we really need to be equipped for is to find ways of taking down such content much faster. In such situations, it is critical to address them quickly. Currently, we don’t have the provision of labelling content, and we may have to look at the law to bring it in. Labelling makes it easy for people to identify what is real and what is artificially created. At present, a lot of content is going without labelling, and one cannot tell the difference. This actually results in people ultimately not trusting anything, even if it is genuine.

The government recently expressed concern about big tech monopolies with respect to revenue sharing with news publishers. What is the ministry’s take on this?
Yes, this issue has been brought up by associations of digital news players who have expressed concerns over how the revenues are divided. The ministry believes that these digital news producers and their journalists put in rigour to bring out stories; there is an associated cost with it, and it is an important social function. We recognise it as the fourth estate and is an important medium of keeping people informed. The revenue sharing is a commercial aspect. So, there is a caution between ensuring what is a public good and, at the same time, seeing how much you can interfere in a contractual agreement of payments. But we will examine, there are laws on this in other countries, and based on them, we will see what can be done.

Electronics exports are on an uptick. Are there specific strategies or initiatives in consideration to boost the global competitiveness of Indian electronic goods and services?
There are two aspects to exports. First, take the category of mobile phones. Our domestic production of mobile phones is able to meet the entire demand. Beyond this, if the sector has to grow, then exports would also have to grow. That is the position we put ourselves in through successful PLIs and being able to have capacities for exports. Some tariff rationalisation took place before the interim budget, and we hope that it will fuel more exports, particularly of mobile phones. When it comes to other electronics, we are still quite import-dependent.

One way of looking at it is that we don't have protection, and it's difficult to produce without tariff barriers. But on the other hand, you can look at it as an opportunity even without tariff barriers and strive to become competitive. The success of the government's support to any sector is determined by that sector's ability to export and become competitive. We have to create an environment where exports can take place even as the domestic demand is met.