Signal Lost: China’s Silent Curbs Disrupt India’s $32 Billion Export Call

Image Source: The Economic Times

India's hot phone export plans are being derailed by an unexpected source—China's de facto barriers to trade. According to the India Cellular and Electronics Association (ICEA), such unnotified but intended restrictions are threatening the nation's target to export $32 billion in smartphones in the current financial year.

Key concerns raised by ICEA

- China reportedly delays the delivery of capital equipment, rare earth materials, and restrict the travel of skilled technical personnel
- These practices are not clearly codified but are implemented through word-of-mouth directives and operational chokepoints
- The disruptions are mounting production costs, extending delivery timeframes, and reducing India's competitiveness in electronics manufacturing globally.

Impact on India's cellular phone market

1. India exported $24.1 billion worth of smartphones during FY25, and is eying $32 billion in FY26
2. Apple, Google, Motorola, and Samsung are among the major players redirecting production to India, benefiting from the government's production-linked incentive scheme
3. Regulations in China are strict on technology transfers and equipment imports, especially on entities like Foxconn and Tata Electronics
4. ICEA warns that unless addressed, such restrictions can reverse recent progress and slow India's integration into global value chains

Why it matters

Smartphones have moved up from the 167th position to the number one position in India's export basket in the past decade. China's stealth squeeze poses not only to trade volumes but to India's strategic position as a world electronics hub.

Sources: Economic Times, Business Standard, Times of India, ORF, Scroll.in