India-EU FTA Unlocks $750 Billion Electronics Market

• The India–EU FTA could open the $750-billion EU electronics market to Indian manufacturers and cut costs for advanced machinery imports
• LED TVs, lighting and home appliances are expected to gain most as EU import duties are removed
• India–EU electronics trade could grow from $20 billion to over $100 billion by 2035, boosting exports and investment

Indian electronics manufacturers are expected to experience substantial gains when India-European Union free trade agreement negotiations progress toward an expected opening of the EU electronics market which is valued at $750 billion.

The proposed pact will provide Indian companies with major export opportunities while it decreases the expenses of importing essential European machinery and technology for electronics and semiconductor production.

The agreement supports India’s efforts to grow its electronics export business and increase its position in the global value chain according to reports.

The key provision enables both parties to mutually recognize standards and certifications which will create faster approval processes and shorter product development times while ensuring Indian products meet European regulatory standards.

The most obvious benefits from the current situation will develop across specific product categories. The EU currently imposes high import duties on LED televisions, LED lighting and home appliances, which differ from the low import tariffs that IT hardware products currently enjoy.

The FTA will remove duties on televisions and lighting equipment, which will enhance market access for Indian manufacturers through better product availability.

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Sunil Vachani who serves as Chairman and Managing Director of Dixon Technologies believes that tariff elimination will create new opportunities for the company to expand its export operations.

The company which previously dedicated its efforts to domestic production now prepares to establish its marketing and distribution operations for entering the European market.

The industry executives believe that the deal will improve access for European buyers to Indian products because smartphones tablets and IT hardware already face minimal import duties.

The India Cellular and Electronics Association estimates that India’s electronics trade with the EU which currently stands at about $20 billion will increase to $50 billion by 2031 and reach over $100 billion by 2035 through proper implementation.

The agreement will create new business opportunities between India and Europe through its expected impact on European investment into India.

The electronics and semiconductor industry plus advanced manufacturing programs can achieve better results through reduced trade barriers and shared regulatory standards that will also decrease costs for semiconductor projects by eliminating import duties on special equipment.