Jun 01, 2007This article was originally published by RFID Update.
June 1, 2007—India is behind its North American and European counterparts in adoption of RFID technology, according to a recent feature from ZDNet Asia. With its burgeoning domestic economy and growing role as a source for goods shipped abroad, however, eventual RFID adoption is almost certain. Indeed, a number of initiatives are already underway. This article highlights ZDNet's key findings about the RFID market in India.
There are three primary inhibitors to RFID adoption on the subcontinent: the relatively small size of Indian companies, the cost of the technology, and the lack of commercial or government mandates. "Indian companies are much smaller than some of their western counterparts and lack the scale to justify large-scale rollouts of any technology, including RFID," ZDNet quoted T. S. Rangarajan, the head of RFID at Tata Consulting Services (TCS), one of India's "big three" IT services firms (the other two being Infosys and Wipro).
RFID's cost, long a complaint of would-be adopters the world over, is a more pronounced issue in India, where ZDNet reports tag prices reach about 60 cents. The price is staggering when compared to the sub-10-cent levels for volume purchases in North America and Europe. The sticker shock might not last for long, however, as SAP India's vice president of marketing and sales operations Nagaraj Bhargava predicts tag pricing could plummet to the 20- or even 10-cent range in the not too distant future.
As for mandates, they are largely to thank for the uptake in RFID in both North America and Europe. It is no surprise, then, that the lack of mandates in India has resulted in slower adoption. This is the case in other countries too, like Australia.
Despite the litany of hurdles to RFID adoption, Indian technology firms are optimistic. As the country's dynamic development continues, the need to efficiently move goods from point A to point B will intensify. As supply chain efficiency matures, RFID is the logical enabler. Furthermore, India is increasingly a manufacturer of goods consumed abroad, in nations whose own supply chains are equipped with RFID. These customers could apply pressure on Indian manufacturers to adopt (a trend long predicted for China). Bhargava of SAP, who already claims 200 RFID customers across 16 industries, is particularly bullish: he believes the Indian RFID market could surpass a whopping 70 percent in annual growth.
Read the article from ZDNet Asia
