“Growth in electronics exports typically activates demand across components, tooling, testing, logistics, embedded software, automation, and skilled engineering roles. This interconnectedness lets the sector add to industrial depth while also supporting higher value addition than volume-led exports.” Mukesh Vasani, Chairman and Founder, Aimtron Electronics
India’s electronics sector has reached an inflection point. After years of capacity creation and policy groundwork, 2025 marked a shift from episodic export gains to more capability-driven growth. The year offered useful insights into what is working within the ecosystem, what remains structurally constrained, and how the sector may evolve as global supply chains continue to recalibrate. Electronics holds a distinct position within India’s export landscape because its value creation extends well beyond finished goods. Growth in electronics exports typically activates demand across components, tooling, testing, logistics, embedded software, automation, and skilled engineering roles. This interconnectedness lets the sector add to industrial depth while also supporting higher value addition than volume-led exports.
“Developments in 2025 indicate that policy support, while necessary, is not sufficient on its own.”
Developments Observed in 2025
Export performance during 2025 suggests that electronics has emerged as one of India’s more resilient export categories. Growth was driven primarily by mobile phones, consumer electronics, and select components, with demand concentrated in markets such as the United States, the UAE, and certain regions of East Asia. Monthly export figures remained relatively stable through the year, indicating improvements in production planning, logistics coordination, and delivery reliability. An important factor underlying this performance was the closer alignment between policy incentives and execution. Production-linked incentive schemes appear to have supported scale expansion and encouraged firms to move beyond pilot capacities. Compared with earlier years, a higher share of electronics production was directed toward exports, reflecting increased integration with global value chains. At the same time, the year also highlighted ongoing dependencies within the sector. Imports of semiconductors, displays, and advanced printed circuit boards continued at a high volume, reinforcing the limited domestic availability of critical inputs. Developments in 2025 indicate that policy support, while necessary, is not sufficient on its own. Sustained competitiveness in electronics exports will depend on execution depth, supplier maturity, and logistics reliability highlighting the need for the ecosystem to shift from policy-led expansion to execution-led performance.
“Segments including automotive electronics, industrial electronics, renewable energy systems, and connected devices showed increased participation from domestic manufacturers.”
Structural Shifts Within the Ecosystem
Beyond export volumes, 2025 reflected gradual structural changes across the electronics manufacturing ecosystem. There has been a measured movement away from basic assembly toward higher-value activities such as system integration, testing, and design-linked manufacturing. Segments including automotive electronics, industrial electronics, renewable energy systems, and connected devices showed increased participation from domestic manufacturers. Another development was the growing emphasis on compliance with international standards related to quality, safety, and cybersecurity. These requirements were largely driven by customer expectations and regulatory frameworks in export markets rather than domestic mandates alone. Their adoption has implications for long-term competitiveness, particularly in sectors such as IoT, industrial automation, and defence-linked electronics. These shifts suggest that export growth in electronics is increasingly influenced by capability depth rather than capacity alone. While the transition remains uneven across segments, the direction of change has become more visible.
“Export growth may increasingly depend on higher-value categories, including automotive systems, industrial control equipment, and specialized electronics, rather than consumer products alone.”
Considerations for 2026
As the sector moves into 2026, several considerations are likely to influence export outcomes. Firstly, semiconductor localization initiatives under the India Semiconductor Mission may gradually alter import dependence, although their near-term impact is expected to be incremental. Progress in assembly, testing, and packaging, alongside compound semiconductors, could support downstream manufacturing over time.
Equally important is component manufacturing, which remains a critical area of focus. Strengthening domestic capabilities in printed circuit boards, displays, power electronics, and passive components could improve value retention and reduce supply chain risk. These inputs are particularly relevant for growth areas such as electric mobility, telecommunications, and industrial electronics.
We also expect trade arrangements and evolving global sourcing strategies to shape market access. Export growth may increasingly depend on higher-value categories, including automotive systems, industrial control equipment, and specialized electronics, rather than consumer products alone. This shift may place greater emphasis on reliability, lifecycle support, and design collaboration.
Lastly, workforce readiness and research capabilities will remain relevant as manufacturing processes incorporate greater automation and data-driven controls. India’s existing engineering talent base offers an advantage, but effective integration between design, manufacturing, and quality functions will be necessary to sustain export competitiveness.
“The experience of 2025 suggests that electronics has begun to assume a more stable and credible role within India’s export profile, moving beyond episodic growth.”
Positioning in a Competitive Global Landscape
India’s electronics sector operates within a competitive global environment shaped by established manufacturing ecosystems such as China and cost-efficient alternatives, including Vietnam and Mexico. While cost structures and ecosystem maturity differ across these markets, India’s relative strengths lie in the scale of domestic demand, policy continuity, and a growing base of engineering capability.
The speed and coherence of ecosystem development will determine how effectively India captures relocating supply chains. Coordination across industry, policymakers, and international partners will be essential to closing execution gaps and accelerating capability build-out. The experience of 2025 suggests that electronics has begun to assume a more stable and credible role within India’s export profile, moving beyond episodic growth.
As global supply chains place increasing emphasis on diversification, resilience, and long-term reliability, India’s electronics manufacturing sector is entering a more consequential phase of its evolution. The year 2026 will be pivotal in determining whether recent export gains mature into sustained competitiveness driven by deeper localization, stronger capability development, and disciplined execution across the value chain. The extent to which these elements converge will ultimately define electronics’ role as a durable export engine and a pillar of India’s broader industrial growth strategy.
The author is Mukesh Vasani, Chairman and Founder, Aimtron Electronics
