Facing US tariff turbulence, Indian electronics makers reportedly hit pause on expansion, eye new export markets, and brace for potential policy shifts.
Indian electronics manufacturers are rethinking expansion plans and exploring alternative export destinations as new US tariffs threaten to erode the country’s cost advantage over China.
According to a report by The Economic Times, while smartphones, tablets and laptops remain exempt from the 50% import duties announced so far, other electronic products face pricing pressure in the American market. This is prompting companies to revise strategies and seek clarity on future trade policy, particularly in light of potential changes as Donald Trump returns to the White House.
Munoth Industries, which produces lithium-ion cells for power banks in India, had signed an agreement in January with US-based Anker to supply cells for the American market.
Jaswant Munoth, the vice-chairman of the company noted that now, lithium cells are exempt from tariffs. Still, if Trump imposes duties on them, their US business may shift to other suppliers.
Industry executives say that the uncertainty could slow fresh investments and expansions planned for India. This may occur even as the government seeks to enhance the country’s role in the global electronics supply chain. Some firms are considering seeking government support to cushion the impact of reduced export competitiveness.
The US remains India’s largest electronics export market. In FY25, shipments to the US were valued at $14.7 billion, accounting for 38% of India’s total electronics exports. Other key destinations include the UAE ($3.7 billion, 9.6%), the Netherlands ($2.9 billion, 7.4%), the UK ($1.9 billion, 4.8%) and Italy ($1.4 billion, 3.7%).
Trade experts note that while India has benefited from diversifying its supply chain away from China, the current tariff uncertainty highlights the risks of over-reliance on a single export market. Diversification into other regions, including Europe, West Asia and Southeast Asia, is emerging as a priority for manufacturers.
The sector is now in a ‘standby mode’ as companies weigh production and export decisions against the backdrop of shifting US trade policies.
