In the wake of sudden restrictions imposed on inbound shipments without the requisite licenses by Indian regulators, major tech giants, Apple, Samsung, and HP have taken a decisive step by halting the import of laptops and tablets to India.
The announcement of the new licensing regulations has left industry leaders grappling with a significant challenge, forcing them to swiftly engage with New Delhi to expedite the acquisition of the necessary licenses.
The electronics import market, including laptops, tablets, and personal computers, recorded a value of $19.7 billion in the April to June period, indicating the scale of the impact of this decision.
This decision could potentially result in extended waiting times for launching new models, a concerning prospect especially ahead of the festive season, when sales typically witness a surge.
The stringent measure, aimed at boosting local production and reducing import dependency, has sent ripples through the tech industry and disrupted the lucrative trade of foreign PCs. Earlier, these companies could freely import laptops and similar products. However, the new rule mandates a special license for each import, a measure similar to the restrictions India introduced for TV shipments in 2020.
While the government did not provide a specific reason for this move, it aligns with Prime Minister Narendra Modi’s “Make in India” plan, which emphasizes boosting local manufacturing and discouraging imports. The Indian government has initiated a $2.1 billion incentive plan to encourage the production of laptops, tablets, and hardware within the country.
This move can also be seen as a measure to counter China by diversifying global supply chains and reducing the world’s reliance on China, thereby positioning India as a significant player in the electronics industry.
Moreover, with security apprehensions regarding imports, especially from China, the licensing requirement could help India ensure that hardware is sourced only from trusted partners.
With this move, the Indian government is expecting to at least reach a part of the ambitious $300 billion in annual electronics production by 2026
Apple’s production landscape in India includes approximately 7% of its global iPhone manufacturing, though this doesn’t extend to iPads or MacBooks. Throughout the period from April to December in the previous year, the technology giant recorded iPhone exports exceeding $2.5 billion from India.
Within the Indian market, Lenovo and HP, recognized as industry leaders, have established manufacturing operations for commercial computers. In terms of India’s personal computer sector, HP secured a notable 30% market share in Q1 2023, closely followed by Lenovo and Dell at 15.7% and 13.9% respectively.