US tariff hit on India: Electronics sector faces $20–30 billion potential loss; semiconductors could be next in line
India's electronics sector could face a major hit, with potential losses of $20-30 billion in future business opportunities due to US tariffs, which may expand to include semiconductors, according to industry experts and company executives.
Despite Apple and Samsung likely receiving tariff exemptions, including 100% semiconductor tariffs, due to their planned US investments and existing Indian manufacturing operations.
"The latest developments will make India even more reliant on smartphone exports, while the rest of electronics may suffer, which in turn will hurt the entire ecosystem," said an executive, quoted by Economic Times. In FY25, US-bound electronics exports from India totalled $14.6 billion, with smartphones comprising $10.5 billion (72%).
The remaining exports included electric inverters, battery chargers, and transformer parts.
Also read:
Prolonged 50% duty could cut India's growth by up to 0.8%; next round of trade talks 'important', says Morgan Stanley
India's total electronics exports in FY25 reached $38.6 billion. The US led with 38% share, followed by UAE (9.6%), Netherlands (7.4%), and UK (4.8%). UAE and Netherlands serve as transit points for Indian electronics reaching the US market.
Analysis of HS codes reveals nearly $4 billion of India's non-smartphone electronics exports to the US are subject to 50% tariffs.
by Taboola
by Taboola
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The April 5 US customs order specifically excludes smartphones, tablets, laptops, servers and certain telecom equipment from reciprocal tariffs.
Non-exempt electronics face 50% tariffs: 25% reciprocal tariffs are active, with an additional 25% secondary tariffs (linked to Russian oil purchases) starting August 27. Semiconductor tariff rates will vary based on component content. Motorola, despite increasing US exports from India, may face semiconductor tariffs without confirmed US investment plans.
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