India Adhesives and Sealants Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

Electrcal and Electronics Segment to Drive the Market Growth

Due to their excellent characteristics and physical properties, such as good cohesion, adhesion, elasticity, high-cohesive strength, flexibility, and their role in improving peel strength by flexing with peel stress, the high elastic modulus of the substrate, resistance to thermal expansion, and environmental resistance from UV light, corrosion, saltwater, rain, and other weathering conditions, adhesive and sealants are extensively used in the electronic industry. Sealants are an integral part of electronic parts and are used to manufacture and assemble various electronic items. There is a steady rise in the demand for electronic sealants, primarily due to the growth and advancement of electronic goods and the high penetration of smartphone devices.

In the electronics industry, adhesives are used for various applications, such as conformal coatings, bonding of exterior plastic housings, bonding of surface mount devices (SMDs), bonding of heat sinks and potting, encapsulating electronic components, protecting terminal electrodes, sealing lids, and housing groves, conformal coating of circuit boards, and many other electronic gadgets. In the process of electrical and mechanical assembly, silicone sealants are highly flexible. They can be used as form-in-place gaskets to connect components inside electronic modules, close holes in the panel to exclude soil, water, or other contamination, and protect against exposure to harsh environmental conditions, such as high temperatures.

The electronics industry in India is one of the fastest and major end-user industries, contributing to the Indian economy. Many products, such as consumer electronics, communication equipment, and other equipment for military operations, contribute a major share of the electronics market. Several global producers of consumer electronic products are shifting or starting their manufacturing bases in India, due to the availability of cheap labor costs and easy access to raw material. This scenario has been observed for the past few years, and the trend is likely to increase at a faster rate, primarily due to the Make in India initiative launched by the Indian government. This has a direct impact on assembling different electronic components to produce a complete product before entering the market. Thus, this is estimated to propel the demand for adhesives and sealants in the electronics sector for various assembling applications. Despite the decrease in production in the electronics industry due to the COVID-19 pandemic, the electronics industry is likely to grow in the future, due to the growth in the electronics sector by increased consumer spending in the country.

According to the Ministry for Electronics and IT, the electronic products market in India had a total market size of INR 4,580 billion (USD 66 billion) and witnessed a CAGR of nearly 5.5 % over the last four years. The National Policy on Electronics, 2019, aimed to promote domestic manufacturing and export in the entire value-chain of Electronics System Design and Manufacturing (ESDM) to achieve a turnover of INR 26 trillion (USD 400 billion) by 2025. The government of India has taken several steps to promote the domestic electronics manufacturing industry and exports from the country. For instance, the Modified Special Incentive Package Scheme (M-SIPS) provides a 20-25% subsidy for investments in capital expenditure for setting up an electronics manufacturing facility. Therefore, 212 projects have been approved so far, with proposed investments of INR 551.82 billion. Therefore, this boom in electronic products in the country is quite instrumental in propelling the market demand for adhesives and sealants in the electronic industry over the forecast period