A recent study reveals that India is gradually challenging China's supremacy in electronics exports in certain crucial markets. This shift comes as manufacturers seek to diversify their supply chains away from China to other regions across Asia.
The escalating geopolitical tensions between the UK, the US, and China have notably influenced trade dynamics and according to data from London-based Fathom Financial Consulting, India's electronics exports to the US surged from 2.51 per cent to 7.65 per cent in November 2023, compared to China's share. Similarly, India's electronic exports rose from 4.79 per cent to 10 per cent in the UK.
The Indian government is enticing electronics manufacturers to establish their presence in the country by offering substantial incentives, including tax reductions, rebates, simplified land acquisition processes, and financial support. The objective is to bolster the domestic manufacturing sector, increase exports, and facilitate the growth of businesses by fostering global partnerships.
India is a substantial manufacturing base for Samsung Electronics Co.'s largest mobile phone factory. At the same time, Apple Inc. produces at least 7 per cent of its iPhones in the country through its contract manufacturers, Foxconn Technology Group and Pegatron Corp.
The surge in electronic exports is likely attributed to Foxconn's growing investments in India, as Andrew Harris, an economist at Fathom Financial Consulting, noted in a recent analysis.
India's advancement in capturing market share has been relatively constrained in Europe and Japan, indicating a shift towards dual supply chains (China plus one) rather than a total cessation of production based in China, at least for the present time," Harris remarked. The study illustrates that India's electronics exports, compared to China's, accounted for 3.38 per cent in Germany and 3.52 per cent worldwide.
Indian organisations have been highlighting their involvement in multinational corporations' "China plus one" strategy, wherein manufacturers establish supplementary capacity in alternative countries.
Aluminium and its alloys play a significant role in manufacturing electronic and microelectronic components, making it one of the predominant materials in modern electronic devices like smartphones, laptops, and peripheral accessories. Nokia and HTC were pioneers in utilizing aluminium for handset construction, but it was Apple that popularised aluminium accessories and phones, exemplified by products like the latest iPad Pro featuring 5G connectivity and the 24" iMac released in 2021. Manufacturers across the industry have embraced aluminium due to its distinctive properties, ensuring its continued use in phones and various other electronics.
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