With trade talks paving the way for growth in smartphones, TVs, ACs, and more, India reportedly eyes a bigger slice of the US electronics market.
India is set to increase its share of the US electronics market, as ongoing negotiations for a bilateral trade agreement (BTA) between the two countries could unlock new opportunities.
According to a report by Business Standard, the talks aim to boost exports from India in key sectors, such as mobile devices, air-conditioners, colour TVs, wearables, and audio equipment, which are predominantly supplied by China, Vietnam, and Mexico.
In 2023, India accounted for just 1.9 per cent of the US’s $520 billion electronics import market, amounting to only $10 billion. More broadly, India’s share of total US imports across all categories stood at 2.8 per cent. Despite this, India has seen a growing presence in certain areas, notably smartphones, where Apple’s products contribute significantly to the country’s exports.
However, the country still lags behind countries like Vietnam and China. With Vietnam’s dominance, particularly in smartphones, India can benefit from potential tariff advantages under the proposed BTA, particularly in the smartphone market, where the US imports $60 billion annually.
In addition to smartphones, India is aiming to make inroads into other electronics segments where it has had little presence. For example, in areas such as switching and routing systems, desktops and servers, and air-conditioners, Mexico has been the major player due to its free trade agreement with the US.
With the new 25 per cent duty imposed on Mexican imports, India could seize the opportunity to increase its market share by reducing or eliminating tariffs on products like colour TVs and air-conditioners.
The Indian Cellular and Electronics Association (ICEA) is lobbying for tariff reductions to facilitate this shift, arguing that eliminating barriers could allow India to better compete with China and Mexico in these critical markets.
