India has removed import taxes on some key mobile phone components to boost local production. Finance Minister Nirmala Sitharaman announced this change in the annual budget on Saturday. The move will benefit major smartphone companies like Apple and Xiaomi.
India’s electronics production has grown significantly, doubling in the past six years to reach $115 billion in 2024. The country is now the world’s second-largest mobile phone manufacturer.
Apple led India’s smartphone market in 2024 with a 23% share of total revenue, followed by Samsung at 22%, according to research firm Counterpoint.
The removed taxes applied to important mobile phone parts like printed circuit board assemblies, camera module parts, and USB cables. These items were previously taxed at 2.5%. Lowering these taxes will help India stay competitive in global trade, especially during a year of uncertainty caused by U.S. tariff policies under President Donald Trump.
While Trump wants more manufacturing to return to the U.S., India is using U.S.-China trade tensions as an opportunity to expand its role in global supply chains. Last year, India’s IT ministry warned that without lower tariffs, the country could lose out to China and Vietnam in smartphone exports.
In last year’s budget, Sitharaman had promised a review of India’s customs duty system to simplify trade and remove unnecessary tax burdens. The review also aimed to fix issues where raw materials were taxed higher than the final product, making local production less efficient. India’s complex tariff system has often been criticized as a barrier to growth and a source of trade disputes.
