According to a report by EY, India’s telecom sector is among the worst impacted by the recent hike in import duties imposed by the United States. The report highlighted that tariffs on telecom exports from India to the US will surge from zero per cent earlier to 26 per cent from April 9, 2025. With exports valued at $ 6 billion, the telecom sector is expected to experience increased cost pressures. However, India still retains a competitive edge over countries such as China and Vietnam, which are facing even steeper duties.
To address these challenges, the report recommends that the Indian government expedite the finalisation of the Bilateral Trade Agreement (BTA) with the US, particularly to support the agriculture sector. It also suggests extending the Production Linked Incentive (PLI) scheme beyond 2026 and implementing initiatives like Mission 500 to boost exports and competitiveness.
The report concluded that while higher US tariffs pose a serious challenge to India’s export-led sectors, strong domestic manufacturing, trade agreements, and supportive policies can help India maintain its competitive edge and drive future growth.
In addition, S. Krishnan, secretary, Ministry of Electronics and Information Technology (MeitY), stated that manufacturers in the electronics and IT sectors are not “overly” concerned about the tariff hikes. He added that the actual impact would depend on how the trade and tariff dynamics unfold in the coming period.
