New Delhi, February 13 India needs to address its structural cost disadvantages, leverage free trade agreements (FTAs), and promote the manufacturing of strategic components to boost its exports of electronic goods, according to the NITI Aayog's Trade Watch Quarterly report released on Friday.
The electronics segment represents a global market worth USD 4.6 trillion. However, India's share in this market is only around 1 per cent for 2024. Key markets for high-tech components like integrated circuits and semiconductors remain dominated by China, Hong Kong, and Taiwan.
While recent FTAs improve access to external markets, the government think tank in its report called for greater emphasis on predictable domestic procurement, export finance, and regulatory simplification to attract investment, "especially in a turbulent geopolitical environment."
These measures can help India transition from a manufacturing base to a globally competitive electronics ecosystem and support the USD 500 billion manufacturing ambition by FY2030.
According to the report, which tracked export trends for the July-September quarter, India should enhance market access and integration into global value chains through proactive trade facilitation, government procurement support, anchor investments, MSME participation, and higher domestic value addition.
It suggested that India's electronics strategy must transition from assembly-led gains to component-led manufacturing.
"On the supply side, incentives need to be aligned toward domestic value addition, sustained R&D, and ecosystem deepening supported by anchor investments that transfer technology, improve standards, and generate stable demand for local suppliers," the report stated.
Cross-border e-commerce will emerge as a key driver of India's export growth, supporting the push toward higher merchandise exports by 2030, with electronics likely to play a central role, the report says.
India's export growth between 2015 and 2024 is concentrated in segments like telecom and mobile phones, while segments such as chips and semiconductors show minimal gains.
The country's electronics exports are largely directed to the USA, UAE, and the Netherlands, and are largely concentrated in mobile phones, which make up 52.5 per cent of the basket, while power equipment and wires contribute smaller shares. Imports are dominated by integrated circuits (23.7 pc), mobile phones (17.5pc), and data-processing machines (10.6 pc).
Overall, in the second quarter, trade destinations remained broadly stable, with exports to top markets growing strongly, led by Hong Kong, China, and the US, while imports from the UAE surged 48 per cent year-on-year, the report said.
During the September-end quarter, exports drove trade growth, with merchandise and services exports both rising by about 8.5 per cent y-o-y, outpacing import growth.
India and the European Union (EU) announced on January 27 that they had concluded and finalized negotiations for their proposed free trade agreement.
This will be India's 19th trade deal. The FTA will help boost the country's exports to the 27-nation bloc.
Since 2014, India has finalized seven trade pacts – Mauritius (April 2021 implemented), Australia (December 2022 implemented), UAE (May 2022 implemented), Oman (signed in December 2025), UK (signed in July 2025), EFTA (implemented in October 2025 - Switzerland, Iceland, Liechtenstein, Norway), and New Zealand (talks concluded in December 2025).