Indian Finance Minister Nirmala Sitharaman announced on Saturday, as part of the annual budget, the removal of import duties on key components used in mobile phone manufacturing. The decision is expected to further strengthen local production, benefiting companies like Apple and Xiaomi, according to a report by Reuters.
Over the past six years, India’s electronics manufacturing sector has more than doubled, reaching $115 billion in 2024. As a result, India has now emerged as the world’s second-largest mobile phone manufacturer.
In 2024, Apple led the Indian smartphone market in terms of revenue share with 23%, followed by Samsung at 22%, according to research firm Counterpoint.
The government’s latest move removes the 2.5% import duty on components such as printed circuit board assemblies (PCBAs), certain camera module parts, and USB cables—all essential for mobile phone assembly.
Amid global trade uncertainties, this tariff reduction will make India’s mobile manufacturing sector more competitive. India is particularly keen to capitalize on the U.S.-China trade tensions and counter efforts by the U.S. to bring manufacturing back home under former President Donald Trump’s ‘America First’ policy.
India’s IT Ministry had previously warned that without a reduction in tariffs, the country could fall behind China and Vietnam in smartphone exports.
During last year’s budget announcement, the finance minister had pledged to review the tax structure to simplify it and make it more business-friendly. The new duty revisions aim to eliminate the ‘inverted duty structure,’ where import duties on raw materials or intermediate goods are higher than on finished products.
India’s complex tariff system has long been a major obstacle to local manufacturing and has often led to trade disputes. The latest policy shift is expected to significantly ease these challenges and enhance India’s standing as a global mobile manufacturing hub.
