India’s smartphone exports are set to cross Rs 1.70 lakh crore in the current financial year – a rise of 31% from Rs 1.29 lakh crore in FY24. Around 70% of the shipments are made up of iPhones. Products of Samsung and domestic contract manufacturer Padget Electronics (Dixon) and a small amount of merchandise exports make up the balance 30%.
According to industry sources, smartphone exports reached Rs 1.10 lakh crore in the April-November period, which is 45% higher than the export figure of Rs 76,221 crore for the corresponding period in FY24. In November, monthly exports stood at Rs 20,000 crore, the highest.
Apple’s iPhone vendor Foxconn, based out of Tamil Nadu, was the largest contributor to smartphone exports. This less-than-four-year-old iPhone factory is also India’s largest in terms of employees across all sectors, with a headcount of nearly 42,000, of whom more than 72% are women. The second-biggest contributor in the iPhone ecosystem is Tata Electronics, followed by Pegatron which is said to be in final talks for acquisition by the Tata Group.
The smartphone production-linked incentive (PLI) scheme’s success has been secular across multiple policy objectives. Industry association ICEA recently provided a four-year (2021-2024) assessment, informing the government that against a total PLI disbursement of Rs 5,800 crore during this period, the smartphone industry contributed a revenue of approximately Rs 1.10 lakh crore on account of incremental GST and duties on components. It has created more than 300,000 direct and 600,000 indirect jobs — majority of them for women.
The smartphone industry added exports worth Rs 2.87 lakh crore during this period. Domestic value addition, according to the India Cellular and Electronics Association (ICEA), is up to nearly 20%.
“The sector’s success is owed to a deep government-industry partnership. To remain hyper-competitive to enhance exports, we have sought some select tariff rationalisation and tax reforms as part of the upcoming Union Budget,” said Pankaj Mohindroo, chairman, ICEA.
In FY24, India exported Rs 1.29 lakh crore worth of smartphones and Rs 2. 41 lakh crore worth of electronics. Two-thirds of the smartphone exports and a third of the electronics exports were made up of iPhones.
Communications and IT minister Ashwini Vaishnaw had told FE in an interview earlier that the government was working on a strategy for an export-led growth for smartphones and electronics. For this, the ministry of electronics and IT would work closely with the ministry of finance for making movement of goods across borders very smooth. According to him, import duties, processes, automation, and warehousing are among the areas to be looked at for the purpose.
“Today India has become part of the global value chain of mobile phones and electronics. Now we are looking at a strategy of export-led growth rather than simply import substitution and looking at our needs,” Vaishnaw had said. “A great opportunity has come our way and we have reached a level where we can rapidly grow our exports,” he had added.
