The Indian electronics industry sees a golden opportunity to attract investments after the US paused reciprocal tariffs on India and over 75 other countries, while imposing steep 145% duties on Chinese exports.
Industry players said the 90-day pause can be used to actively court global manufacturers looking to diversify their supply chains away from China. They plan to collaborate and support the government to swiftly facilitate the relocation of production lines to India.
US President Donald Trump on Wednesday paused the implementation of reciprocal tariffs. India, slapped with 26% tariffs, will now pay 10% duty on exports to the US for the time being.
In contrast, China - which accounts for majority of electronics exports to the US - is facing a punishing 125% tariff, which would likely make most products significantly more expensive in the US.
It's not only the big few companies, but even the medium and smaller enterprises, who have to press the paddle and grab the opportunity arising out of the new geopolitical situation when two of the world's leading economies are at a trade war, one of the industry executives said.
It is high time for India to offer a long term and comprehensive solution to the US to get the maximum benefit out of the situation and establish itself as an alternative manufacturing destination, the person said.
"We appreciate the Government of India for not responding hastily (to US announcement of tariffs), and instead adopting a calibrated approach that reflects a strategic understanding of the opportunities presented," electronics industry lobby body India Cellular and Electronics Association (ICEA) told ET on Thursday.
Since this waiver also applies to Vietnam, the industry wants the government to act swiftly and decisively.
"Delays in leveraging this favourable period may result in missed opportunities as companies may opt for alternative destinations that offer more immediate advantages," ICEA chairman Pankaj Mohindroo said.
However, India must try to remove the structural disabilities in the sector to attract investments, industry insiders said.
As of now, Vietnam and India have to pay similar 10% tariffs on exports to the US, but the Southeast Asian country is better placed in terms of the overall manufacturing ecosystem with virtually zero duties on a majority of the products, they said.
Industry players said the 90-day pause can be used to actively court global manufacturers looking to diversify their supply chains away from China. They plan to collaborate and support the government to swiftly facilitate the relocation of production lines to India.
US President Donald Trump on Wednesday paused the implementation of reciprocal tariffs. India, slapped with 26% tariffs, will now pay 10% duty on exports to the US for the time being.
In contrast, China - which accounts for majority of electronics exports to the US - is facing a punishing 125% tariff, which would likely make most products significantly more expensive in the US.
It's not only the big few companies, but even the medium and smaller enterprises, who have to press the paddle and grab the opportunity arising out of the new geopolitical situation when two of the world's leading economies are at a trade war, one of the industry executives said.
It is high time for India to offer a long term and comprehensive solution to the US to get the maximum benefit out of the situation and establish itself as an alternative manufacturing destination, the person said.
"We appreciate the Government of India for not responding hastily (to US announcement of tariffs), and instead adopting a calibrated approach that reflects a strategic understanding of the opportunities presented," electronics industry lobby body India Cellular and Electronics Association (ICEA) told ET on Thursday.
Since this waiver also applies to Vietnam, the industry wants the government to act swiftly and decisively.
"Delays in leveraging this favourable period may result in missed opportunities as companies may opt for alternative destinations that offer more immediate advantages," ICEA chairman Pankaj Mohindroo said.
However, India must try to remove the structural disabilities in the sector to attract investments, industry insiders said.
As of now, Vietnam and India have to pay similar 10% tariffs on exports to the US, but the Southeast Asian country is better placed in terms of the overall manufacturing ecosystem with virtually zero duties on a majority of the products, they said.
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