Our Bureau
New Delhi
There is distress in India’s smartphone and electronics manufacturing ecosystem as there are reports of some pattern of informal and targeted trade restrictions imposed by China. The top smartphone and electronics manufacturers of the country have claimed that this is a very alarming situation and needs to be looked into.
The India Cellular & Electronics Association (ICEA) has written a letter to the Minister of Electronics and Information Technology, Ashwini Vaishnaw informing what are the issues that the manufacturer market is facing. They stated that the companies have identified three issues that are majorly disrupting the production, raising costs, and threatening India’s export competitiveness.
One of the major issues according to the manufacturers was that China, over the past eight months, has put significant restrictions over the exports of high precision tools and that are equipment used in electronics manufacturing in India. The restrictions are on critical capital goods like heavy duty boring machines, which are now facing complete export bans or customs delays from them.
It is being reported that if India doesn’t get these equipment from China and looks to import it from other countries like Japan or South Korea it is going to cost the country around 3-4 times more than what they currently get. This will directly impact India’s cost advantage and spike up the production costs.
They have reported that there are increasing restrictions on the exports of critical minerals and rare earths, which are hugely important in the production of electronic devices and smartphones. The lCEA stated that if China continues these restrictions, India doesn’t have many cost-effective alternatives for these materials.
The ICEA has also addressed that the travel restrictions that have been put on Chinese technical personnel working in India has not helped at all in the struggle. They emphasized on the necessity of these expert technicians for operating Chinese-origin machinery and facilitating technology transfer.
