India’s Electronics Exports Surpass $20 Billion, Fueled by Apple’s iPhone
Booming smartphone shipments drive record growth in India’s electronics exports
India’s electronics exports have experienced a remarkable surge, surpassing the $20 billion mark in the first nine months of the fiscal year 2023-2024. Spearheaded by Apple’s iPhone, the booming smartphone shipments have played a significant role in this unprecedented growth. According to the India Cellular and Electronics Association (ICEA), mobile phone exports alone reached $10.5 billion, accounting for 52% of the total electronics exports during April to December 2023. This surge in exports has propelled the electronics industry to the fifth position among the top 10 categories of exports, up from the sixth position in the previous year.
iPhones Drive Surge in Electronics and Mobile Exports
The surge in both electronics and mobile exports can be largely attributed to iPhones, which have emerged as the single largest contributor to this growth. In December 2023, iPhone exports crossed $7 billion, constituting 35% of total electronics exports and a staggering 70% of the country’s total mobile exports in the nine-month period ending in December. This dominance of iPhones in the export market has played a pivotal role in catapulting India’s electronics industry to new heights.
Electronics Exports on a Fast Growth Trajectory
The rapid growth of electronics exports has been driven by favorable government policies, particularly the smartphone production-linked incentive (PLI) scheme introduced in 2021. This scheme has accelerated the uptake of electronics exports, propelling the industry from the ninth position to the fifth position among export categories. With the robust growth trends continuing, it is projected that electronics exports will likely secure the fourth position by the end of this fiscal year. The India Cellular and Electronics Association (ICEA) predicts that mobile phone exports will reach $14-15 billion by the end of the fiscal year.
Apple’s Success and Samsung’s Challenges
Apple and its three contract manufacturers – Foxconn, Wistron (now owned by Tata group), and Pegatron – have been instrumental in driving the growth of mobile exports. While Apple has consistently exceeded the production targets under the PLI scheme, Samsung has faced challenges in export performance, even missing the production targets for the fiscal year 2021-2022. Apple’s success in achieving the ₹1 lakh crore production mark in 2023 not only showcases the company’s commitment to the “Make in India” initiative but also highlights India’s potential to become a global supply chain hub.
Seeking Favorable Policies for Continued Growth
With exports expected to further drive expansion in mobile phone manufacturing, the industry is advocating for a favorable tax and tariff regime that can compete with countries like China and Vietnam. The industry is aiming for a target of $50 billion in exports over the next few years and is seeking specific policy interventions to facilitate the expansion of global value chains in India. These interventions would help build a robust ecosystem and boost domestic value addition.
Conclusion:
India’s electronics exports have witnessed remarkable growth, crossing the $20 billion mark in the first nine months of the fiscal year 2023-2024. The surge in smartphone shipments, particularly driven by Apple’s iPhone, has been a key driver of this growth. With favorable government policies and the success of the smartphone production-linked incentive (PLI) scheme, the electronics industry has climbed the ranks among export categories, showcasing India’s potential as a global supply chain hub. As the industry aims for further expansion and a target of $50 billion in exports, it calls for specific policy interventions to ensure a competitive tax and tariff regime and facilitate the growth of global value chains in India. The future looks promising for India’s electronics exports, with the potential to cement its position as a major player in the global market.