India has eliminated import duties on key components needed to manufacture mobile phones. This announcement was made by Finance Minister Nirmala Sitharaman during the annual Budget 2025 presentation on Saturday (1 February). The move is aimed at boosting local production of mobile phones, making it cheaper and more attractive for companies like Apple and Xiaomi to manufacture their products in India.
The decision becomes more interesting considering US President Donald Trump’s continued tariff threats to BRICS countries, including India, which could create instability in global trade. Experts believe that the import tax cuts on mobile phone components will help India manage economic uncertainties in the coming year.
Meanwhile, this reduction in import taxes is expected to prominently benefit two major smartphone brands (as mentioned earlier), the US-based Apple and Chinese firm Xiaomi. Since both companies are key players in the Indian smartphone market, lower import taxes will likely reduce their costs for bringing smartphones into India, allowing them to offer more competitive prices, which could boost sales. Speaking of the stats, according to a 2024 report, Apple has captured around 23% of the total market revenue.
As per data from the India Cellular and Electronics Association (ICEA), India’s electronics production is projected to hit approximately $115 billion in 2024. Of this, mobile phone production is expected to exceed $50 billion, playing a major role in driving the overall figure. Last year, PM Modi himself announced the $500 billion electronics production target by 2030.
This announcement comes at a time when market research firm Counterpoint Research’s data shows growth in smartphone shipments in the country. The Indian smartphone market grew 1-5% YoY, with shipments between 153-156 million units in 2024. Interestingly, while Vivo emerged as India’s top-selling smartphone brand, Apple led in market value last year.
Speaking of the Budget 2025, the Ministry of Electronics and Information Technology has been allocated around ₹26,026 crore for FY 2026, up from ₹17,566.31 crore in the previous financial year. In terms of specifics, the government has significantly increased funding for key schemes, including the Production-Linked Incentive (PLI) for mobile phones, IT hardware, the semiconductor scheme, and the IndiaAI Mission, raising the allocation by approximately 84%, bringing it to ₹18,000 crore for the upcoming fiscal year.
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