India’s electronics exports surged to ₹4.24 lakh crore in FY2025-26, marking an 11-fold increase over the last decade. Mobile manufacturing emerged as the primary driver, pushing electronic goods to become the country's third-largest export category. While this growth supports job creation and GDP, investors should monitor the trade balance regarding component imports and the long-term impact of government incentive schemes.
India’s electronics sector has recorded a significant transformation in FY2025-26, with exports climbing to ₹4.24 lakh crore. This 11-fold increase from the 2014-15 baseline highlights the country's rapid rise as a manufacturing hub. The sector has now secured the position of the third-largest export category for India, signaling a major shift in the country's economic focus from a consumer of electronic goods to a global production participant.
Mobile Manufacturing Leads the Surge
The most prominent factor behind this growth is the mobile phone segment. Once a minor export item, mobile phones are now the premier export product for the country. Exports in this segment jumped to ₹2.59 lakh crore in FY2025-26, a 165-fold increase from the ₹1,500 crore recorded in 2014-15. India has effectively scaled its position to become the world’s second-largest mobile phone manufacturer. The broader electronics manufacturing sector, which includes mobiles, semiconductors, and components, saw total production reach ₹13.11 lakh crore, reflecting the impact of policies aimed at attracting global investment.
Policy Impact and Employment
This growth is largely attributed to government-led initiatives, including the Production Linked Incentive (PLI) Scheme, the India Semiconductor Mission (ISM), and the Electronics Components Manufacturing Scheme (ECMS). These programs have provided the necessary financial incentives to attract large-scale assembly operations. Beyond exports, the sector has been a significant engine for employment, generating 12 lakh jobs. Data indicates high participation from women, who make up approximately 70 percent of the workforce in mobile manufacturing and nearly 30 percent in the broader electronics ecosystem. Furthermore, the digital economy now contributes roughly 14 percent to India's national GDP, supported by expanded internet connectivity and falling data costs.
Investor Monitorables and Risks
While the headline export growth is robust, investors and analysts often look for the quality of this growth, specifically focusing on 'value addition.' A significant portion of current activity involves the assembly of imported components. As a result, the rise in electronics exports has also been accompanied by high import growth in raw materials and electronic parts. This trend can pressure the trade deficit if the country does not deepen its local component manufacturing capabilities.
Looking ahead, the sustainability of this growth depends on several factors. The first is the effective implementation and budget support for PLI and other incentive schemes. The second is the ability of manufacturers to move up the value chain by producing complex components locally rather than relying on imports. Finally, the sector remains sensitive to global demand and changes in international supply chains. Investors tracking the electronics sector will likely watch for trends in domestic component manufacturing and the consistency of export demand in key global markets to gauge the long-term viability of these production facilities.