Trump -Tariff Divide India’s Electronic Manufacturing Industry | Today news

New -Delhi: US President Donald Trump’s announcement of reciprocal rates on imports from countries around the world has created a sharp distribution within managers and observers of India’s electronic manufacturing industry. Some have said that in the long run there would be no impact on India to become a global electronic manufacturing center. But others have raised serious concerns about possible setbacks in India ambitions, and suggested that if Trump’s rates maintained, India could lose some of its stimulating countries with less tax to the US, such as Brazil. They said it was especially relevant if the growing importance of India as a manufacturing center for businesses such as Apple, and other technical firms that wanted to diversify from China to, possibly India. Atul Lall, managing director and CEO of India’s largest contract producer, Dixon Technologies, said the primary focus of Indian EMS (Electronic Manufacturing Services) firms remains the domestic market, which is largely not affected, and added that it is too early to determine the full impact on Indian firms. “But it must be seen how businesses are going to set footprints in the US,” Lall said. “The major change will be seen in how American consumers will be serviced in terms of access to electronics.” He added that to further understand the long -term impact, tariff stability and individual bilateral treaties must also be investigated, including India’s continuing trade conversations with the US. On the other hand, Navkendar Singh, co-vice president at IDC India, raised concerns about policy uncertainty and possible geopolitical pressure. Singh also highlighted the risk that Apple is reconsidering the expansion of India. “There is a bilateral trade agreement that is in the works between India and the US, which will certainly have an impact on the electronic industry,” Singh said. He pointed out the risk of geopolitical pressure that Apple sets up in the long run to set up a mounting plant in the US or at least stop the expansion of India. “Such movements will not only contribute the cost and margin for Apple, but also the effort by India to increase the value chain in the global electronic manufacturing and supply chain,” Singh said. Data from the Industry Body India Cellular and Electronics Association (ICEA) have shown that iPhones make up $ 14.5 billion from February, or 70% of India’s smartphones exports. Although there is no specific number for US exports, four operating analysts estimated that at least 15% of India iPhones were sent directly to the US – which added at least $ 600 million extra tax that Apple has to pay for importing iPhones to the US from India. A Apple spokesman did not respond to Mint’s request for a statement on Trump’s rates. The Apple Story Apple’s pressure to make iPhones in India began in February 2017. Since then, the company has increased local manufacturing in the country and even used India as a basis to export devices to the rest of the world, including the US. According to three market analysts with Mint, Apple sold about 110-120 million iPhones in the US last year. With all made in China, Vietnam, Brazil or India, Apple will have to pay the import tariffs from 10% (in Brazil) to 46% (in Vietnam). The consensus of the analyst suggested that it could lead to an additional tariff liability of up to $ 10 billion on Apple-with the lowest inplanted manufacturing destination that Brazil is, as the rates. IT Minister Ashwini Vaishnaw said last week that Apple has 64 dedicated assembly plants for its manufacturing efforts in the country today. The private held Tata Electronics Private Limited, as well as China’s largest contract manufacturer Foxconn’s Indian vent, are two of the largest benefactors of Apple’s localization storage. Tata Electronics and Foxconn are Apple’s largest contract manufacturers in India, who gather the company’s latest iPhones in the country. Analysts believe that Trump’s rates will lead to multiple negotiations around the world with the US, which will disrupt the current status quo – where India is an important benefactor of technical companies who want to diversify their manufacturing efforts beyond China. Global Impact A senior analyst at a top brokerage firm has added, which requests anonymity, that a slowdown in localization could impede India’s ultimate economy for 2030. ‘On the face of it, Indian EMS firms do not have a major exposure to the US non-Dixon Technologies seeing 5% of its US revenue, while it is not for 2-3. Drastic potential shift in the global EMS supply chain driven by the US, “the analyst said. A second analyst at a fellow brokerage firm added that such a move could also impede India’s proposed value -adding growth. China’s BBK electronic brands. Although no one will move a fifth place to India in the next five years, Apple has so far had a target on the running wheel to manufacture India to a quarter of the annual iPhone output, “the analyst said. However, the negotiating table will depend a lot on this. Six months can be drastically different – or maybe not there at all, “said Tarun Pathak, partner and director of counterpoint. He added that India’s electronic manufacturing has so far grown on the back of import replacements. said. In the meantime, the risk of indirect exports must remain vigilant to be used as an indirect path to exporting the route, stakeholders said. Ajai Chowdhry, co-founder of HCL Technologies Limited, said although the impact on China is worse than on India according to the current form of Trump’s rates, it could lead to India being used by its neighbor for indirect exports. “We need to be vigilant about the electronic waste of China in India, and have to have a high degree of concern in an indirect trade war. We do not want to change in a trade colony of China at no time,” Chowdhry said. Catch all the business news, the news reports and the latest news updates on Live Mint. Download the Mint News app to get daily market updates. Business Newsnewsindiatrump -Tariff Divide India’s electronic manufacturing industry more less