Centermulls maximize electronic earnings amid uncertainty over Apple exports

Copyright © HT Digital Streams Limit all rights reserved. The industry Shouvik Das 4 min Read 08 Apr 2025, 05:30 AM IT From last month, India exported $ 14.5 billion to electronics, of which nearly $ 9 billion was accounted for by smartphones. (Bloomberg) Summary The increasing domestic value adding will lead to higher net earnings of foreign electronic firms – a key factor to make India a more important geography in the global electronic supply chain, even in light of Trump tariffs. New -Delhi: The central government weighs some suggestions from consultants and veterans in the industry to increase domestic manufacturing of electronic components, especially smartphones, according to three people who are aware of the matter that spoke on condition of anonymity. Such a move would reduce the dependence on imports and help save foreign exchange for the country, these people added, especially in light of the reciprocal rates announced by the US administration last week. Most components for making smartphones, also for Apple’s iPhone, are still imported. One proposal advised the Ministry of Electronics and Information Technology to begin the deployment of warehouses with special privileges for import taxes to ensure that companies build stock of electronic sub components and raw materials. Such stock would help India to speed up the electronic component engineering domestically, which in turn will increase the net worth of electronic items made in the country. The people quoted above said that a framework for producing local components is expected in the coming weeks. Mity did not immediately respond to Mint’s request for comment. Read also | Why India’s electronic sector is at least in danger due to Trump’s tariff investigation “The current tariff environment remains uncertain worldwide, leading to unprecedented reactions from various countries to the reciprocal rates of the US,” the first person quoted above. “This is an important moment in the electronic journey of India and raising India’s value in the global electronic supply chain will be the key to marking it as an important geography.” The addition of low value from last month exported India $ 14.5 billion to electronics, of which nearly $ 9 billion was responsible by smartphones, including $ 6 billion by Apple’s iPhones – compiled in India by Tata Electronics and Bharat Foxconn International Holdings groups. However, India’s domestic value addition (contribution to GDP) from this export is only 10-15%, according to operational and government managers. This leaves India with about $ 600 million to net earnings from iPhone exports. According to the industry’s estimates, exports of iPhone to the US $ 1 billion (from the total of $ 6 billion), which will now submit 26% to the trading tariff. While India is relatively favorable compared to China or Vietnam for Apple to export its products, Brazil and Thailand offer cheaper tax rates and in turn a chance for Apple to maintain its sales margin. Read also | Budgets smartphones sell like hot cakes in the Tepid Market Apple did not respond to Mint’s request from Monday to comment on the Indian manufacturing expansion plans. Two industry analysts said Apple exported about 17-20 million iPhones from India, and until Trump’s rates were announced on April 2, the company is expected to increase by 2028. Now that this expansion is potentially uncertain, domestic value adding is a clear way to continue the benefits of the global importance of the electronic industry. ‘Certainly, the addition of domestic value refers to the total amount added to the gross domestic product (GDP) of a country from an industry. In India, an estimate of the thinking tank, Niti Aayog, which was published in July last year, said: “In a business as usual, India’s electronic market could amount to $ 278 billion against FY30”. At the same time, India is aimed at its overall electronic ecosystem, including sales income, to cross $ 500 billion. Government and private industry sources PEG India’s domestic value addition is currently at 15% – which will give India about $ 40 billion worth of value to GDP within the next five years. Read also | Electronics manufacturing companies that better exceed indices this year, in place of this, said the three people with which Mint spoke with more local manufacturing could increase the value of the electronic ecosystem to 30% during this period. Quick shift “Although it is expected to occur in the long run, the proposal to speed up the addition of domestic value is the key for India to isolate itself relatively in the light of Trump’s rates, which also affects India,” the second person quoted above. India’s industrial veteran Ajai Chowdhry, co-founder of HCL and chairman of Epic Foundation, said the current market conditions are important for India to increase the addition of domestic value. “Although the components scheme has been announced, it is important to note that more than responding to US rates, it is now an important moment to increase the increase in value adding in India’s electronic ecosystem. Removal of the local component will quickly help to be a nation with a low-margin, a higher, Electronic Ecositions, “a higher, chapters in the global electronic electronic electronic ecosization,” higher-values, stakholder in the global electronic ecosition, “a higher, chapters, stack holder in the global electronic electronic factors,” Electronic factors, a higher, chapters in the sturdy holder in the global electronic electronic electronic electronic factors. Read also | Smartphone addiction: Does India stand with a digital crisis? ‘We don’t know if the rates will remain consistent for the next five years. If it were certain, India could possibly navigate and find a strategy in the long run. From where it stands today, Trump’s uncertain world policy can abolish the rates of trade in the near term. India can also lose a mounting contract on the sector, and in the near term, domestic value will not have an immediate impact. Catch all the industry news, bank news and updates on live currency. Download the Mint News app to get daily market updates. More Topics #chinese Smartphone #android Smartphone #Make #Make in India Mint Specials