What’s behind India’s surging smartphone exports?

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smartphone manufacturing hub like China, yet. It is still importing a large chunk of the components that go into a smartphone. Smartphone exports from India picked up speed in the latter part of 2020, and crossed $1 billion a month in late 2022.

According to news reports, Apple assembled 14% of its iPhones, worth $14 billion, in India last year. The government attributes this to the production-linked incentive (PLI) scheme, which began in 2020 and which provides subsidies to firms that meet production targets. Also read: Dixon is becoming India’s Foxconn But much of the global manufacturing for electronics does not take place in any one country – it's split up across the world.

It's therefore critical that Indian manufacturing be a part of such ‘global value chains’. A quantitative metric used in this context is global value chain-related trade, in which plants import raw materials, process them, and re-export them to their final markets. According to the World Bank, India’s total global value chain-related trade in manufacturing is about 50% of its total gross manufacturing trade.

In electrical and optical equipment, the share is slightly lower, but it shows how entwined such trade is. In the context of smartphones, Indian manufacturers are still importing critical parts rather than making them here. India’s smartphone exports have also jumped in volume terms.

In 2023-24 the country exported about 52 million smartphones, up from 49 million in 2022-23 and 44 million in 2019-20. But perhaps more importantly, the average value of each smartphone exported has increased sharply, from $85 per unit in 2019-20 to $296 per unit in 2023-24. This is almost certainly due to the fact that Apple has become a major smartphone exporter