India’s Electronics Industry Seeks Government Action Amid Rising Gulf Competition

India’s electronics industry is growing concerned about increasing competition from Saudi Arabia and the UAE in the manufacturing sector. India Cellular and Electronics Association (ICEA) has urged the government to address this challenge through diplomatic negotiations rather than imposing retaliatory tariffs. These Gulf nations, with their Special Economic Zones (SEZs), cost advantages, and supportive policies, pose a direct threat to India’s electronics exports.

Several developing nations, including Brazil, Turkey, Saudi Arabia, and the UAE, have lower tariff rates (10%), while the Philippines imposes a 17% tariff. ICEA warns that Saudi Arabia and the UAE, in particular, could quickly emerge as strong competitors due to their manufacturing incentives and lower labor costs. The association, representing key manufacturers like Apple, Xiaomi, Foxconn, and Lava, stresses the need for proactive engagement with policymakers to maintain India’s competitive edge.

ICEA also highlighted concerns over the U.S. administration’s 27% reciprocal tariff announcement, despite recent trade negotiations with India. The association advises against reciprocal tariff measures, emphasizing the importance of diplomacy and leveraging provisions within U.S. trade policies for better outcomes. Continued engagement with global partners remains crucial for India’s electronics export growth.

Source: Moneycontrol