WTF is Consumer Electronics: The Blueprint for Founders Eyeing India’s $72B Consumer Electronics Market

National, April 28, 2025: WTF is Podcast, hosted by Indian investor and entrepreneur Nikhil Kamath, returns with a powerhouse episode, this time diving deep into India’s booming consumer electronics space. Titled “WTF is Consumer Electronics,” the episode brings together consumer electronics trailblazers Carl Pei, CEO of Nothing; Rahul Sharma, Co-founder and CEO of Micromax; and Amit Khatri, Co-Founder at Noise, for a raw, insightful, and no-jargon conversation on building scalable consumer electronics companies in India.

From decoding manufacturing, design, product innovation, supply chains, to health tech, AI, and hardware startups, this episode is a sharp, practical guide to help founders start smart, build right, and innovate with intent. Key takeaways include:

1. India’s consumer electronics: The $72 billion opportunity: India’s consumer electronics market stands at $72 billion with 600 million smartphone users. Carl Pei highlights, “Smartphones globally is about 1.2 billion units every year. In India, it’s 120 to 140 million annually, depending on what number you look at. So, if you assume that the ASP (Average Selling Price) is $300, then 1.2 billion, that’s over $300 billion, just on the hardware side.” Amit Khatri adds, “In a category like truly wireless, for example, the Indian market would be like 60 million units, which is six crores. And around a billion-dollar market value. So, phones would be about $150 million smartphones and 50-60 million feature phones. So on a broad level, India has a penetration of 600 million smartphone users in the country.”
2. The real opportunity in consumer electronics:  Rahul, Carl, and Amit emphasize that the real opportunity in India’s consumer electronics (CE) sector lies in deep product innovation, strategic thinking, and technical expertise – not just branding or distribution. Success demands that founders focus on niche segments, design thinking, AI disruption, and India’s evolving manufacturing ecosystem. Think wearable health tech (like smart rings and socks), affordable hearing aids, Gen-AI-powered apps, and niche components such as glue, plastic caps, and vibration motors.
3. Entering India’s thriving consumer electronics market: Amit Khatri advises targeting growing segments like $20–$50 Bluetooth devices with tech strength. Carl Pei however, offers a different perspective and suggests, “If somebody was young and wants to get into consumer electronics, I would urge them to first become a content creator. Because the barrier to entry is very low. Everybody can do it, and that’s the arbitrage opportunity now.” He emphasizes the need to build credibility first before suppliers take a brand seriously. In today’s landscape, it’s ultimately a game of credibility and distribution, where content creation or brand building becomes the true arbitrage opportunity.
4. Start niche, scale smart:  Carl recommends, “Start with something more focused, something more niche, lower risk, lower capex, and evolve from there. Rahul and Amit see opportunity in underpenetrated areas like mid-market home appliances and practical, India-first home electronics. Rahul suggests, “You have to identify gaps and say, yes, there is a market. Also, if you have a passion, you will figure out a way to find the right people.”
5. Why product is the real power play: To truly succeed in the consumer electronics space, Rahul emphasizes the importance of solving real, observed day-to-day problems, while Carl points out that manufacturing demands deep sectoral expertise, not just strong marketing. However, Amit warns, “If somebody’s trying to go to a commodity market, it’s no go. It’s a race to the bottom. There is no winning there.”
6. Health Tech & Wearables: The next big bet in consumer electronics? Amit Khatri sees strong potential in emerging health tech niches like smart wearables (e.g., temperature-tracking socks, health rings) but notes challenges in affordability and real-world usage, especially with devices like CGMs. He believes mainstream adoption will depend on making these technologies more accessible, particularly for users over 35. Carl Pei adds that health tech and even children’s education have strong product-market fit in India, where consumers are increasingly willing to invest in well-being and learning.
7. Gen-AI & Software Disruption: Carl sees a window for startups to challenge iOS/Android with Gen-AI-driven app ecosystems where apps are voice-generated, fast, and flexible. Carl highlights, “I see that a younger, more nimble company can navigate a changing world way quicker. And the big moment that’s enabling all of this is the advancements in AI”. Rahul says, “There will be a time where you will be able to train the largest of the models using one single server. You will not need a farm of servers. We have seen a trailer in the form of DeepSeek already. And I think very soon, we’ll be using it. This means that the access to technology will be massified.” Amit predicts, “I think 80% of the population will just chill and receive income from the government. And a small group of people will leverage the new technologies to push society and humanity forward. Like universal basic income.”
8. Building India’s Supply Chain: To build a resilient consumer electronics supply chain in India, Rahul Sharma outlines a phased approach: “The process is that you start with, initially, you start with the Electronic Manufacturing Services (EMS) process. Then you start getting the design out there in the country. Then after design, you start working on the supply chain, the component ecosystem. So this all is a process one by one.”
9. China’s dominance in manufacturing: Rahul Sharma explains that China’s dominance in manufacturing wasn’t merely due to incentives but to a robust infrastructure, logistics parks, supplier hubs, and freight readiness, enabling them to scale. Rahul emphasized that India needs to develop similar infrastructure to position itself as a global export hub, especially in consumer electronics. He says, “See what China has done in the last 25 years in terms of all the government policies. We’re discussing incentivizing, but the rest of the other enablers, for example, the whole supply chain in terms of materials and everything, they have worked a lot deeper on that segment. In terms of logistics, they have created logistics parks to enable that. They have taken all these measures, not only in one segment, but in every segment they have done with all those policies.”

1. PLI: Rahul emphasizes the need for local products to be economically viable, supported by government schemes like the PLI. He states, “PLI is a good scheme. But the larger point here is that you have to ensure that locally made products make more sense for anybody who wants, who is selling. If an entrepreneur wants to buy, he should be able to source it locally. And it should be cheaper for him, not because he’s forced because of a regulation. It should also make sense economically for him to do that”.

1. Tariffs*: Nikhil shares his perspective on reciprocal tariffs, mentioning, “If tomorrow I was selling to country XYZ, and I was selling them something and they were charging me 30% duty on it. If I was buying something from them, I would assume the same duty should apply.” However, Rahul offers a more nuanced perspective and explains, “It’s not binary. It depends on how you want to bring up your country. In China, way back, they decided that they’re not going to allow the foreign companies, foreign companies can only come with JVs, because they want to build their champions. Rahul explains that China’s protectionist policies strategically nurtured national champions like Alibaba and Baidu, showing that long-term development often requires prioritizing national interests over pure free-market ideals.

*DISCLAIMER: This episode was recorded before the announcement of the latest changes in Reciprocal Trade And Tariff Policies. As a result, some of the views/opinions shared may not reflect the most recent tariff regulations globally.

1. Incentivising the Consumer Electronics sector: Rahul highlights that funding is available, through banks and government schemes, but stresses that entrepreneurs must actively research and apply for the right programs. He says, “There are so many schemes which people are not even aware of. For example, everyone knows of PLI but there is also DLI, which is Design-Led Incentive for the chipsets and all. You have to put in effort to know of these schemes.”
2. Founder Fuel: Amit’s advices, “Pick up a smaller subset of whatever problem you want to solve, go double down and then move on. There will definitely be failures, learnings, but I would term them as learnings and you keep pivoting with that”. Carl advises, “Be really sure that you want to do something. It’s not always fun. I think most people should not be entrepreneurs. If you really want to accomplish something, you can, but there’s a cost associated with it. And I think for most people, the cost is not worth it.” Rahul advises, “My only advice will be to show me your five friends. You will become like whatever your company is. So just keep a cohort of those people.” Rahul also reflects on the importance of sticking to your core and advises that focusing on what you’re best at can drive growth and scale effectively.
3. EMS: Amit emphasizes that the Government’s push for localization, coupled with the upcoming Production Linked Incentive (PLI) scheme for components, makes this a ripe moment for investment in electronics manufacturing and EMS (Electronics Manufacturing Services), which he believes will define the next decade. He says, “Components is a huge opportunity. For example, India is projecting a market of $500 billion by 2030. It’s a huge market.”

Access the whole podcast here: Ep #23 | WTF are Consumer Electronics? | Nikhil ft. Carl Pei, Rahul Sharma & Amit Khatri

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