Growth in computer hardware sector falls by 3 pc

The grey market grew by whopping 49 per cent during the year and affected the organised IT industry significantly because of its price sensitivity.

"In short-run the industry is tiding over the problems of policy upheaval – neither the budget 1999-2000 nor the exim policy have been conducive to the growth and development of the hardware industry", MAIT director Vinnie Mehta told reporters.

During 1998-99 the personal computer segment grew at 29 per cent selling 10.27 lakh units as against eight lakh units in 1997-98 when the industry had grown at more than 32 per cent.

The association has demanded withdrawal of customs duty on parts and components which are not manufactured in the country to induce the market. Presently, the duty component comes to more than 18 per cent.

MAIT officials said the delay in the implementation of Task Force report on hardware sector was also instrumental for the dismal performance of the hardware industry.

The Task Force report II on the hardware industry mainly talks about the rationalisation of the duty structure and conducive atmosphere for making investment in the country.

"We are also expecting speedy implementation of IT Task Force report II on the hardware sector which has been forwarded for cabinet approval", MAIT president Hemant Bharat Ram said.

Many corporate houses including LG, Samsung, Acer and other hardware manufacturers are waiting for a stable policy before making any investment in India, Bharat Ram said.

According to MAIT desktop PC’s have made significant inroads into the 2.5 to five million and less than 2.5 million population town classes. It grew by 49 and 57 per cent respectively in these towns.

The server market grew by 41 per cent to 35,900 units in 1998-99 as against 25,000 units in the previous year. The printer market comprising DoT Matrix, Laser and Inkje printers witnessed a change in the market mix, MAIT said. The share of laser printers in the total installed base rose to 13 per cent in 1998-99 from 10.2 last year, while that of DoT Matrix printer fell by eight per cent to 47 per cent from 55 per cent during the same period, MAIT said.