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India Secures Half of Shipment Decline from China, Vietnam

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In Short:

India is catching up with China and Vietnam in mobile phone exports, with a surge of 40.5% in FY24 exports. This reflects the success of the smartphone production-linked incentive scheme in attracting companies looking to diversify from China. Apple, in particular, has doubled its production and exports from India, with iPhone exports contributing 65% of India’s mobile exports. Samsung is also set to increase exports from India, benefiting from the PLI scheme.

India Sees Sharp Rise in Mobile Phone Exports, Closing Gap with China and Vietnam

New Delhi: India is witnessing a significant increase in mobile phone exports, narrowing the gap with top exporters China and Vietnam. According to officials, while mobile exports from China and Vietnam dropped by 2.78% and 17.6% in FY24, respectively, India’s exports surged by 40.5% during the same period.

Key Highlights:

  • China and Vietnam Decline: Chinese exports of mobile phones decreased by 2.8%, amounting to a $3.8 billion decline, while Vietnam saw a 17.6% reduction, resulting in a $5.6 billion drop in total exports.
  • India’s Growth: India’s mobile phone exports jumped to $15.6 billion in FY24 from $11.1 billion in FY23, marking a $4.5 billion increase.
  • Success of PLI Scheme: The smartphone production-linked incentive (PLI) scheme played a pivotal role in attracting supply chain shifts from China, with India capturing nearly 50% of the total decline in mobile exports from both countries.

Experts believe that India’s progress in the mobile phone exports sector is a significant achievement for the government, especially amidst geopolitical tensions with China. The country has been successful in luring companies adopting the China+1 strategy to diversify their supply chains and manufacturing.

Success Stories:

Apple, one of the key beneficiaries of the PLI scheme, has expanded its manufacturing operations in India, with vendors reporting a doubling of production and exports in the last two fiscal years. The company’s iPhone exports now contribute 65% of India’s mobile exports and over one-third of the country’s electronics exports, which surpassed $29 billion in FY24.

Similarly, Samsung, another beneficiary of the PLI scheme, is set to increase its mobile phone exports from India. The company exported around $3.5 billion worth of mobile phones from India in FY24, a significant portion compared to Apple’s exports. Samsung is currently the largest exporter of mobile phones from Vietnam.

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