US Tariff Changes Create Growth Opportunities For India's Electronics Exports

(MENAFN- KNN India) New Delhi, Feb 4 (KNN) The US administration's recent tariff hikes on China and Mexico create an opportunity for India's Electronics industry. industry executives believe this could boost exports, particularly in mobile phones, IT products, and televisions.

The trump administration imposed an additional 10 per cent tariff on Chinese imports, while Mexico and Canada face 25 per cent duties.

However, the US paused Mexico's tariff for a month, adding uncertainty. Despite this, India remains unaffected and could benefit.

Smartphones, now India's top export to the US, are expected to gain most. IT products and hardware manufacturing are also set to grow, supported by India's production-linked incentive (PLI) scheme.

China and Mexico together export USD 60 billion worth of IT products to the US annually, presenting a chance for India to step in.

“India should foster a long-term trade relationship with the US through a bilateral deal,” said Sunil Vachani, chairman of Dixon Technologies. He highlighted India's large-scale production, labor-intensive capabilities, and strong local value addition as advantages.

While optimism runs high, concerns remain over potential“universal tariffs” that could include India. The Trump administration's trade deficit-based analysis by April 2025 may also bring new tariffs on India.

Experts note that if Vietnam, whose US trade surplus grew 20 per cent in 2024, faces tariffs, manufacturers may turn to India. Samsung, a major electronics exporter from Vietnam, might consider India as an alternative base.

India is strengthening US ties by reducing tariffs on American goods and agreeing to repatriate illegal immigrants. Prime Minister Narendra Modi's upcoming Washington visit is expected to advance this partnership.

Globally, reactions vary. Canada has imposed 25 per cent tariffs on $155 billion of US imports, while Mexico has ordered retaliatory measures on US goods. China has denounced the tariffs but has yet to retaliate.

India remains in“wait and watch” mode, balancing trade expansion with potential risks. The coming months will be crucial in determining how India can leverage this shifting trade landscape.

(KNN Bureau)

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