India’s electronics manufacturing sector is experiencing a significant boom, with the value of electronics produced rising from $37 billion to $105 billion between 2016 and 2023. The government aims to increase this figure threefold by fiscal 2026. While India currently accounts for only 3% of global electronics production, its share is growing faster than any other country’s.
The mobile phone industry is at the forefront of this growth, comprising nearly half of India’s electronics sector. India has become the world’s second-largest phone manufacturer after China. In fiscal 2015, India imported almost 80% of its phones, but now imports are negligible. Major players such as Apple and Samsung have significantly increased their production in India.
Contract manufacturers, particularly Foxconn, are expanding rapidly in India. Foxconn now has over 30 factories in the country and employs 40,000 Indian workers. The company is investing heavily, including $2.6 billion for a new factory near Bangalore that will produce about 20 million iPhones annually.
Indian companies are also benefiting from this trend. Tata, India’s largest conglomerate, has entered phone manufacturing and is now assembling iPhones. Dixon Technologies, India’s largest domestic electronics manufacturer, has seen substantial growth, with its workforce expanding from 2,000 to 27,000 in a decade and its share price rising by 150% over the past year.
Several factors contribute to India’s electronics manufacturing boom:
1. Western tech companies’ desire to reduce reliance on China
2. India’s large consumer market of 1.4 billion people
3. Government support through production-linked incentives and courting of foreign manufacturers
The Indian government hopes to eventually replace China as the world’s electronics manufacturing hub. While progress is promising, with electronic exports reaching $29 billion in the fiscal year ending March 2024 (up 24% year-on-year), this still pales in comparison to China’s $900 billion in electronics exports last year.
Challenges remain for India to fully realize its manufacturing potential:
1. Need for Indian firms to deepen their technical expertise to compete in advanced areas such as chipmaking
2. India’s reluctance to lower trade barriers with Asian neighbors
3. Higher import duties on raw materials and components compared to competing countries such as Vietnam
Despite these challenges, some industry leaders are optimistic about India’s future in electronics manufacturing. Sunil Vachani, CEO of Dixon Technologies, likens the current moment to the Y2K era that propelled India’s IT industry to global prominence.
The term “Bangalored” – currently associated with the outsourcing of white-collar jobs from America to India – could come to represent the shift of blue-collar manufacturing jobs from China to India.
Last updated: December 26th, 2025
