India’s Electrical Equipment and Electronics Industry: A Rising Export Powerhouse

India’s electrical equipment and electronics industry is undergoing a transformation that is both deep and global in its implications. Once dependent on imports to meet domestic demand, India is now emerging as a competitive export hub, aiming to capitalize on geopolitical supply chain realignments and the country’s rising capabilities in manufacturing and innovation. With exports projected to exceed ₹3 lakh crore ($36 billion) in FY25 and ambitious targets for the coming decade, the sector holds vast potential—but also faces critical challenges that demand attention.

The Electronics Boom: Powered by Policy and Private Investment

The backbone of India’s electronics export surge is undoubtedly smartphones. With exports touching ₹1.75 lakh crore ($21 billion) in FY25, smartphones alone accounted for more than half of the sector’s outbound trade. Apple’s assembly ecosystem in India, contributing ₹1.25 lakh crore in exports, has become a symbol of India’s shifting role in global value chains. This is not just a statistical success—it is a signal that India is being taken seriously by global tech giants.

Beyond smartphones, the growth in computer hardware, electronic components, and medical electronics is consolidating India’s electronics base. Backed by the Production-Linked Incentive (PLI) schemes and initiatives under “Make in India,” domestic manufacturers are no longer just assembling for export—they are integrating deeper into design, innovation, and value-added manufacturing.

India’s electronics exports are on a firm upward trajectory, with estimates suggesting a rise to $61 billion by 2030, and a policy target of $300 billion in total electronics production by 2026. These are not just optimistic figures; they reflect a solid foundation of policy push, infrastructure upgrades, and investor confidence.

Electrical Equipment: From Modest Base to Ambitious Goals

While the electronics story is more mature, India’s electrical equipment sector, especially hand and power tools, is at the cusp of an export breakout. With only $1 billion in current exports, the sector has a roadmap—articulated by NITI Aayog and industry bodies—to scale this figure to $25 billion by 2035. This tenfold increase may sound ambitious, but with focused interventions in quality certification, design innovation, and logistics efficiency, it is attainable.

Other sub-segments such as wires, cables, and batteries are riding the wave of infrastructure growth and renewable energy demand, both domestically and globally. Export potential in these areas is strong, particularly for green energy installations in the Middle East, Southeast Asia, and Africa. However, the sector still faces hurdles in terms of high import dependence for raw materials and inconsistent power infrastructure, especially in tier-2 and tier-3 industrial zones.

Clusters Driving the Export Engine

Several industrial clusters are anchoring India’s growing reputation as a manufacturing and export powerhouse in electronics and electricals:

Tamil Nadu (Chennai, Sriperumbudur): The state contributed over 32% of India’s electronics exports in FY24, with robust infrastructure, policy support, and availability of skilled labor.
Karnataka (Bengaluru): A tech-driven hub that combines electronics hardware with R&D capacity, making it ideal for high-value electronics exports.
Uttar Pradesh (Noida, Greater Noida): Emerged as a smartphone assembly hub, especially with investments from Samsung and Lava.
Maharashtra (Pune, Aurangabad): Known for electrical equipment and components, with a strong base of auto-electronics and power gear manufacturers.
Gujarat and Telangana: Emerging as new growth zones with policy incentives and dedicated electronics parks.

Export Markets: A Growing Footprint

India’s electronics and electrical equipment exports are gaining ground in developed and emerging markets alike. The United States is the single largest destination, accounting for more than 30% of India’s electronics exports. The UAE, UK, Netherlands, Italy, and Vietnam are other significant markets. Electrical equipment such as wires, panels, batteries, and tools are finding buyers in Europe, Middle East, and Africa, indicating a healthy diversification beyond traditional markets.

The Policy-Driven Growth Engine

Central and state-level incentives, particularly under the PLI scheme, have catalyzed investment inflows into electronics manufacturing. Tax breaks, duty waivers, and fast-track clearances have made India an attractive alternative to China in the global electronics supply chain. The government’s ambitious vision to build electronics manufacturing clusters and invest in semiconductor fabs, though facing some setbacks, continues to reflect long-term commitment.

Furthermore, the Free Trade Agreements (FTAs) under negotiation—especially with the EU and UK—could offer tariff advantages that would make Indian exports even more competitive.

Barriers and Bottlenecks

Despite its upward momentum, the sector is not without its pain points. High import duties on raw materials and essential components, infrastructure gaps, and fragmented logistics networks continue to erode price competitiveness. While Apple and Samsung have embraced India for assembly, local component sourcing still lags. Moreover, geopolitical trade tensions, particularly with China and the U.S., expose Indian exporters to potential tariff risks and currency volatility.

India also faces stiff competition from China, Vietnam, South Korea, and Taiwan. China, for instance, exported over $700 billion in electronics in 2024—nearly 20 times India’s current exports. Catching up will require not just more investment but smarter investment in R&D, design, and skilled labor.

A Sector Poised but Not Guaranteed

India’s electrical and electronics sector is now a key lever of its export diversification strategy. It demonstrates that with the right blend of industrial policy, global partnerships, and local innovation, India can break free of its low-value export trap. But to move from assembly to design leadership, and from modest to dominant exporter, India must invest in quality infrastructure, develop advanced R&D capabilities, and scale up skilling initiatives. If these gaps are addressed with urgency and clarity, India’s target of becoming a $61 billion electronics exporter by 2030 and a $25 billion player in electrical tools by 2035 will not just be achievable—it will be inevitable.

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