US Tariffs May Hit $30 Billion in Indian Electronics Exports
India’s electronics export sector is facing a major challenge due to rising tariffs imposed by the United States, which could result in a loss of $20–30 billion in potential business over the next few years. The tariffs primarily affect non-smartphone electronics exports, with the possible inclusion of semiconductors under high-duty slabs expected to make matters worse.
While big smartphone players like Apple and Samsung may avoid the tariffs due to their investments in US manufacturing, other electronic products such as electric inverters, battery chargers, transformer components, and IT hardware are likely to face duties as high as 50%. In FY25, India exported electronics worth $14.6 billion to the US, of which smartphones accounted for $10.5 billion, about 72% of the total. The remaining $4.1 billion from non-smartphone exports is now at risk.
The US is India’s largest electronics export market, making up 38% of the total $38.6 billion in electronics exports in FY25. Other major destinations include the UAE, Netherlands, and the UK, with some of these acting as transit points for US-bound goods, making the impact of the tariffs even wider.
Only a few electronics categories, like smartphones, tablets, laptops, and servers, are exempt from the US tariff list released in April. All others are now subject to a 50% total tariff, with a secondary 25% duty taking effect from August 27, reportedly linked to India’s continued imports of Russian oil.
The Indian electronics industry had set a goal of reaching $80 billion in US exports by 2030, but that target now appears uncertain. The impact is not limited to electronics, sectors like garments, gems, jewellery, furniture, and machinery are also affected. Exporters are even considering moving production to countries like Vietnam and Bangladesh to stay competitive.
This sharp policy shift by the US is expected to have a cascading effect on India’s wider export economy, potentially slowing growth and affecting jobs across key sectors.
Source: Business Standard
