New Delhi: India has taken a significant step to enhance mobile phone production by removing import duties on essential components. Finance Minister Nirmala Sitharaman announced the decision in the annual budget, providing a major Xiaomi and Apple India smartphone boost as they expand local manufacturing.
India’s Growing Smartphone Industry
India has rapidly grown its electronics production, more than doubling in the past six years. By 2024, the sector reached $115 billion, making India the world’s second-largest mobile phone manufacturer. Apple led the Indian smartphone market in 2024 with a 23% share in total revenue, followed closely by Samsung at 22%, according to research firm Counterpoint.
Key Components Now Duty-Free
The government has lifted the 2.5% import duty on critical mobile phone components, including:
- Printed circuit board assembly
- Camera module parts
- USB cables
This reduction will lower production costs and encourage smartphone giants like Xiaomi and Apple to expand their manufacturing operations in India.
Global Trade Challenges and India’s Opportunity
The move comes amid global trade uncertainty. U.S. President Donald Trump’s push for “America First” policies includes tariff threats that could disrupt supply chains. India is using this opportunity to attract companies shifting away from China. The Indian IT ministry had previously warned that without lower tariffs, the country could lose out to China and Vietnam in the race for smartphone exports.
Simplifying India’s Tariff Structure
Last year, Finance Minister Sitharaman initiated a review of India’s customs duty rate structure. The goal was to simplify tariffs and remove inverted duty structures, where raw materials or intermediate goods were taxed higher than final products. Such policies had previously hindered efficient local production and caused trade disputes.
Conclusion
India’s decision to remove import duties on key mobile phone components provides a Xiaomi and Apple India smartphone boost, making the country more attractive for global manufacturers. With lower costs and a favorable policy environment, India is strengthening its position as a major player in the global smartphone supply chain.
