Indian Government Cuts Import Duties on Mobile Phone Components
In a move to bolster domestic production and attract global electronics firms, India has eliminated import duties on vital mobile phone components. The announcement was made by Finance Minister Nirmala Sitharaman in the country's annual budget presentation.
India's electronics production has surged significantly in recent years, with a six-year growth rate of over 100% to reach $115 billion in 2024. The country has emerged as the world's second-largest mobile phone manufacturer, with Apple leading the market in revenue share (23%).
The latest tariff cuts will facilitate the assembly and production of mobile phones locally. Previously taxed at 2.5%, components such as printed circuit board assemblies, camera module parts, and USB cables will now enter India duty-free.
This move aims to mitigate trade disruptions potentially caused by ongoing global tariff tensions. As the United States seeks to repatriate manufacturing under the "America First" policy, India intends to leverage the current trade landscape to expand its role in global supply chains.
Domestically, the Indian IT ministry has previously cautioned against losing ground to China and Vietnam in smartphone exports due to uncompetitive tariffs. In the previous budget, Sitharaman had announced a review of the customs duty rate structure to streamline and reduce tariffs for smoother trade.
India's complex tariff structure has been identified as a barrier to efficient local production and has sparked disputes. The recent duty cuts address this concern and aim to foster a favorable environment for electronics manufacturing in India.