Automotive as the Key Driver for Electronic Components Globally

The automobile industry is one of the most critical drivers of the economic growth of India and one with high participation in global value chains. The development of this sector has been on the back of strong government support, which has helped it carve a unique path among India's manufacturing sectors. The automobiles produced in the country uniquely cater to the demands of the population's low and middle-income groups, making this sector stand out among the other automobile-producing countries. The growth is mainly due to the companies rearranging their operations and recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges. The market has expected to reach $805.88 billion in 2026 at a CAGR of 10.4%. The general electronic components market consists of sales of available electronic components and related services used in various applications in aerospace, communication, automotive, and other industries. General electronic components are the devices that work within an electronic system to affect their associated fields.

Most of the devices are going smart nowadays, thus increasing the growth of display devices. The display devices are creating many opportunities for the growth of the electronic component market in various applications such as satellite and space technology, automotive, military applications, IoT and others. Due to an increase in demand for electronics components in various applications such as automotive, IoT, intelligent devices, and others, a shortage of electronic components supply has expected to restrain the growth of the general electronic components market in the forecast period.

In many ways, the Indian Government's policy has shaped the automobile industry and nurtured the microeconomic environment it helped to create. Apart from the direct impact through scale policy instruments, the industry policy even in level learning processes and shaped technological capability accumulation.