India’s chip and electronics sectors may face indirect pressure as the US imposes steep tariffs on copper imports.
The recent announcement of a 50% import tariff on copper and semi-finished copper products by former US President Donald Trump has triggered concern within India’s electronics and semiconductor sectors.
While the tariff is intended to strengthen domestic copper supply for critical US industries such as defence, data centres, and electric vehicles, Indian manufacturers are wary of potential ripple effects. Sectors such as electronics assembly and semiconductor packaging in India depend heavily on high-purity copper sourced from global suppliers, some of whom may now prioritise US markets due to higher margins.
Ashok Chandak, president of SEMI India and the India Electronics and Semiconductor Association (IESA), emphasised the critical role of copper in various stages of semiconductor manufacturing, including chip wiring, printed circuit boards, interconnects, and power systems.
He pointed out that India continues to rely heavily on imported refined copper and copper concentrates. Furthermore, Chandak noted that even specialised components, such as gold-coated copper wires utilised in outsourced semiconductor assembly and testing facilities, encounter procedural bottlenecks that hinder progress.
Despite these concerns, India’s direct exposure to the new US tariff remains limited. In 2024, Indian copper exports to the US totalled just around 13,000 tonnes, valued below $300 million, while domestic copper demand exceeded 1.7 million tonnes. Major Indian producers like Hindalco do not export copper to the US, minimising immediate trade risks.
Rajoo Goel, secretary general of the Electronic Industries Association of India, has indicated that India currently does not have the domestic capability to manufacture high-purity copper or specialised alloys like wires, strips, and sheets needed for semiconductor applications.
These essential materials are largely sourced from a small group of global suppliers, with many based in China. He suggested that introducing trade restrictions—such as tariffs or mandatory quality certifications—without establishing reliable alternatives could disrupt the already fragile supply ecosystem supporting semiconductor manufacturing.
Union Mines Minister G. Kishan Reddy confirmed the government is monitoring the situation, particularly for indirect effects such as dumping from other markets.
With over ₹13,100 crore allocated under the Semicon India Programme, the episode underlines the importance of securing raw material supply chains as India accelerates its electronics manufacturing ambitions.
India exported around $2 billion worth of copper and copper products in 2024–25, with the US accounting for $360 million, or about 17% of that total. The US currently ranks as India’s third-largest copper export market, following Saudi Arabia 26% and China 18%. If demand from the US dips due to new tariffs, industry experts believe the shortfall could likely be offset by rising domestic consumption.
