
The trade agreements recently signed by India with the US, EU, EFTA countries (Switzerland, Norway, Iceland and Liechtenstein), UK and GCC have opened unprecedented opportunities for the Indian electronic contract manufacturing sector.
Among competing countries, India has the lowest tariff rate of ~18%. In comparison, Indonesia’s duty is ~19%, Vietnam (~20%), Malaysia (~20%), Taiwan (~32%), China (~34% + additional duties) and Sri Lanka (~44%).
This means lower procurement costs for Indian PCBs, sub-assemblies and consumer electronics – improving competitiveness against Chinese, Vietnamese and Mexican suppliers.
This coupled with the intent of global companies to diversify their supply chain clearly offers an opportunity for Indian companies to become an integral part of the global electronics supply chain.
The journey is exciting, but winning markets ahead of the competition will require Indian companies to do their best in terms of cost, quality, consistency, innovation, compliance, sustainability and exceptionally strong resource settings.
India exported electronic goods worth USD 38.6 billion in 2025, which is expected to grow to USD 46-50 billion in 2026. Export growth has been impressive – CAGR ~25% over the last 10 years, but India still serves only ~1% of the available market. Mobile phones make up ~60% of the total. The US was the largest market with ~60%.
Indian companies need to strategize to take advantage of the opportunities available – a ‘one-fit’ strategy to meet the requirements of all markets will not work. We need to have separate strategies for the US and the EU – the two biggest markets.
What Indian companies need to do
First, they need to strengthen their marketing presence in the target geographies. Concurrently, strengthen the back-office operations, especially the Quote Cell. This is key to customer acquisition as global companies, unlike Indian customers, may not give a second chance to match target prices.
They need to streamline prototyping capabilities because time to market is critical. This would mean significant investment in tool shop capacity.
Strengthening manufacturing, quality, cyber security and EDI interface capabilities is critical. Companies should adopt Industry 4.0 standards, smart factories and IOT-enabled quality management systems to meet EU and US customer demands for reliability.
The EU agreement includes a specialized framework for digital commerce – protection for data transmission, intellectual property and design ownership. This is essential for collaborative research and development, design services and cloud-based production management systems used by EMS companies.
Both pacts include cooperation in green technology and financing, enabling Indian EMS companies to access low-cost funds to invest in sustainable/renewable production processes.
Indian companies must further ensure that the required quality certifications are in place. These should include industry and process specific certifications in addition to general quality certifications. These certificates should be taken from reputed certification agencies. In particular, companies should prepare for EU REACH, RoHS and ESG disclosure requirements.
Companies should build internal audit systems for traceability, ethical sourcing and labor standards, as non-compliance could nullify customs benefits. They should be prepared to have warehouses in target geographies to meet just-in-time customer needs.
The integration device or box infrastructure may be provided in or near the customer’s country. This would also facilitate the provision of timely after-sales services to clients.
The two biggest segments (apart from mobile phones) that Indian companies can cater to are industrial electronics and automotive electronics. In the following paragraphs, each sector is discussed separately for the US and the EU.
For USA: Industrial Electronics
The US imported $30 billion worth of industrial PCBA in 2023 with Taiwan accounting for ~40-42% and China, South Korea, Vietnam, Malaysia and Mexico accounting for another ~40-45%, with the rest coming from the rest of the world. Industrial sensors, robotics controllers, motor drives, power supplies, renewable energy electronics, etc. make up the majority of PCB assemblies imported into the US.
US Imported PCBAs are used in Industrial & Automation, Electrical Equipment & Power Management, Industrial Equipment & Machinery, Industrial Electronics / Sensors & Instrumentation, Power Supplies & Telecommunications & Networking – Routers, Base Station Modules
For USA: Automotive Electronics
ADAS and safety systems, infotainment and navigation, powertrain control units, EV battery management systems lighting, dashboards, safety sensors, etc. This market is worth around USD 60-70 billion in 2024.
Automotive electronics are imported by OEMs, Tier 1 suppliers and EMS companies.
The OEM market is estimated to be ~$20-25 billion annually. It will be a tough and long road for Indian EMS companies to become resellers of these OEMs. Companies should plan for this within a three- to five-year horizon. These OEMs are looking for solutions and may not be interested in simple build-to-print services. Few of the Indian EMS players who are currently ready should opt for this alternative.
The Tier 1 supplier market is estimated at $35-40 billion annually. This segment offers the biggest opportunity for Indian EMS companies. Some of them operate in India and since few Indian EMS companies are already part of the domestic supply chain, it is relatively easier to enter and integrate into their global supply chains.
When it comes to EMS companies, top US automotive electronics importers include Jabil, Flex, Sanmina, Celestica, Benchmark, and Plexus. Since almost all of them have a presence in the APAC region, Indian EMS players do not offer anything unique for these companies to migrate their supply chain.
For EU: Industrial Electronics
Total EU demand for PCB assemblies is estimated at ~$120-130 billion, of which approximately ~$60 billion is covered by domestic production. Industrial electronics and power supplies typically account for 25-30% of EMS demand, which translates to a market size of $20-25 USD.
This includes boards used in industrial automation systems, power supplies and converters, renewable energy converters, motor drives, industrial control equipment, telecommunications and DC power systems.
For EU: Automotive Electronics
The European automotive PCB market is estimated at ~$2-2.5 billion annually, of which 60-70% is covered by imports. ADAS systems, electrical electronics for electric vehicles, battery management systems, infotainment and telematics, and engine and body control modules make up the majority of imports.
In short, the market opportunity is huge, but it will have to be captured by a clear strategy based on each company’s competencies. Each account will need to be nurtured to reach its full potential.
Companies should not jump in blindly, but start acting once they are convinced of their ability to meet customer demands. One wrong step at the beginning of the journey can delay the process by several years.
Companies should prepare short-term (1-2 years), medium-term (2-5 years) and long-term (5+ years) plans so that in five to six years, Indian companies can offer a complete set of services – electronic design, manufacturing, full ownership of the supply chain and product life cycle responsibility.
Jasbir Singh Gujral is the Managing Director of Syrma SGS
Key things
- India has the lowest tariff rate among competing countries, which increases its competitiveness.
- Targeted marketing and robust operational strategies are essential for Indian firms to penetrate new markets.
- Adopting Industry 4.0 standards will be critical for Indian manufacturers to meet global demands for quality and reliability.





