Indian companies that produce electronics for global giants could be the biggest beneficiaries of tariffs being introduced by the administration of US President Donald Trump, the Financial Times reports.
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Last week, it became known that Apple intends to move production of all iPhones to India that will be shipped to the United States. HP announced plans to double its production capacity in India this year – the company wants to take advantage of the government’s program to stimulate production, to increase the production of desktop PCs and laptops in the country.
Dixon Technologies, which partners with HP in India, also makes products for other big brands including Samsung, Panasonic, Motorola and Philips. Dixon shares have doubled in the past year to trade at around 16,200 rupees ($190.23). PG Electroplast, which makes home appliances for LG, Whirlpool and Voltas, was worth 200 rupees ($2.35) this time last year, rose to 1,000 rupees ($11.74) in January and is now trading at 900 rupees ($10.57). Diversified Avalon Technologies, which has clients in everything from clean energy to aerospace, has gained 80% in the past year; Kaynes Technologies has risen 120% in the same period.
Some of these companies have been helped in securing a large number of large orders by the government’s Production Linked Incentive (PLI) program, which is aimed at stimulating manufacturing. But what happens next will depend on the companies themselves — whether they can help their customers diversify their supply chains. Not everyone in the U.S. has welcomed the news of iPhone production moving from China to India, because Trump’s tariffs are, at least in theory, intended to bring manufacturing back to the U.S. rather than shift it from one Asian country to another.
In practice, this is unlikely to happen quickly: American companies will need a reliable workforce, domestic supply chains, and political clarity, all of which are currently in short supply. So Indian companies have a short-term chance to become significant players in the new world order – and they will need to build on their recent successes quickly.