Threatening their competitive edge and manufacturing investments in India, Apple and other manufacturers could reportedly face setbacks if the US imposes reciprocal tariffs on Made-in-India electronics.
Tech behemoth Apple may face challenges if the US under the Trump administration imposes reciprocal tariffs on electronics and smartphones from India, potentially undermining the company’s growing manufacturing base in the country.
According to a prediction by the Economic Times, the Trump administration has expressed concerns over India’s 16.5 per cent import duty on smartphones and electronics, a charge that could prompt the US to retaliate with similar tariffs.
This would make Indian manufacturing less competitive, particularly for Apple, which exports iPhones to the US from its India-based factories. Currently, Apple benefits from zero duties on its Indian-made products, making it more cost-effective to manufacture in India.
Incidentally, the company has also pledged $500 billion to expand its manufacturing capabilities in the US.
Other companies, including Samsung and Motorola, also produce devices in India for export to the US. A tariff increase could disrupt their business models as well, making China a more attractive manufacturing location due to its lower tariffs.
On the other hand, apart from electronics, the auto industry is facing similar concerns. Indian auto component manufacturers, who send parts worth around US$7 billion to the US annually, could see their businesses harmed if the US raises duties.
Currently, many auto components are subject to low or zero duties when exported from India. Still, India imposes higher tariffs on imports from the US, which could complicate trade relations further.
While Indian manufacturers are worried, the comparatively small share of Indian components in the US market—around US$7 billion out of a total of US$300 billion—may offer some insulation.
However, if the situation changes, these industries could face significant financial repercussions. The potential tariffs represent a major risk to India’s export-oriented industries, particularly electronics and auto components, which rely on favourable trade terms.
