India's Electronics Sector Faces Massive Losses Due to US Tariffs

India's electronics industry is on the brink of significant financial setbacks, with potential losses ranging between $20 to $30 billion, as a result of recent US tariffs. Experts warn that semiconductors could be the next target, exacerbating the situation for Indian exporters.

Exemptions and Exceptions: A Silver Lining for Some

Despite the grim outlook, giants like Apple and Samsung may find respite through tariff exemptions, thanks to their substantial investments in the US and existing manufacturing operations in India. This could provide a much-needed buffer for these companies amidst the escalating trade tensions.

The Ripple Effect on India's Export Ecosystem

"The latest developments will make India even more reliant on smartphone exports, while the rest of electronics may suffer, which in turn will hurt the entire ecosystem," an executive was quoted saying. This statement underscores the potential domino effect the tariffs could have on India's broader electronics export market.

Understanding the Tariff Structure

Non-exempt electronics are facing a 50% tariff, split between 25% reciprocal tariffs and an additional 25% secondary tariffs linked to Russian oil purchases, effective August 27. Semiconductor tariffs will vary, adding another layer of complexity for exporters like Motorola, which lacks confirmed US investment plans.