The implementation of a 50% tariff by the United States on Indian imports, starting August 27th, is causing considerable stress for Indian electronics manufacturers. In response, companies are reevaluating their strategies, with a focus on domestic expansion and the identification of new international markets. A number of electronic goods are not covered by the tariffs, which include products like smartphones, tablets, laptops, and some telecom equipment.
Munoth Industries had planned to supply between 500,000 and 1,000,000 units per month to the US market through a deal with Anker. However, the imposition of tariffs on lithium cells could force the company to abandon its US venture. According to Jaswant Munoth, Chairman of Munoth Industries, doing business in the United States provides high-profit margins and offers strong quality control. The loss of the US market would negatively affect the company’s financial projections.
Meanwhile, Dixon Technologies, which had anticipated growing phone exports to the United States by FY27, is now adopting a wait-and-see approach. Sources indicate that there is little that can be done until the full impact of the tariffs is understood. The company plans to seek governmental support if tariffs are levied on mobile phones and semiconductor products.
The United States has exempted a number of product categories, including smartphones, laptops, tablets, and select telecom equipment, from these tariffs. These exports are valued at roughly $50 billion. However, other electronic goods, such as electric inverters, battery chargers, and transformer parts, are subject to a 50% tariff under 14 HS codes.
In response to the tariffs, Indian companies are actively seeking markets beyond the US. The Chamber of Trade and Industry (CTI) has advised exploring markets such as Germany, the UK, Singapore, and Malaysia, based on the demand for engineering products in these countries. The CTI also recommends reducing imports from the United States and finding alternative global suppliers. While India had set a goal of $80 billion in electronics exports by 2030, the tariffs may result in losses of $20 to $30 billion. Some companies that have invested in the United States, such as Apple and Samsung, may be exempt from the tariffs. Pankaj Mohindru, Chairman of the India Cellular and Electronics Association (ICEA), stated that the association will work closely with the government to address the challenges created by the tariffs.