China Dominates 80% Of India's Electronics Imports

China has become the dominant supplier of electronics components to India, accounting for over 80% of imports across 71 product categories in 2025-26. A new study by Koan Advisory Group and the Institute of Chinese Studies analyzed India-China trade patterns and found that the number of electronics categories where China supplied over 80% of India's imports has increased sharply, rising from 44 in 2018-19 to 71 in 2025-26.

The study focused on electrical and electronic equipment covered under Harmonized System (HS) Chapter 85 and found that India's dependence on China is mainly linked to critical components used in telecom infrastructure, consumer electronics, and industrial machinery. The report noted that the large number of tariff lines in the 90-99% band highlights how deeply embedded Chinese sourcing has become in India's electronics imports.

India's trade deficit with China reached $112.1 billion in 2025-26, with electrical machinery accounting for $43.1 billion, or nearly 38% of the overall gap. Lithium-ion batteries have emerged as a major concern, with India's imports from China rising to $3.9 billion. China's share in this segment increased to 83.6%, making batteries a strategic challenge for India's electronics and electric vehicle ecosystem.

The report also highlighted that China accounted for 48.9% of India's semiconductor imports, although its share declined from around 64% a year earlier. The study said that restricting imports alone would not address the issue as the dependence exists largely at the component level. The report recommended expanding domestic upstream manufacturing, supported by critical mineral policies and selective partnerships where local alternatives are limited.

The ultimate objective is a calibrated shift from persistent reliance on imports toward locally embedded manufacturing capacity. This is crucial for reducing India's trade deficit with China and promoting domestic electronics manufacturing. The study's findings have significant implications for India's electronics and electric vehicle industries, which are heavily reliant on Chinese components.

In recent years, India has been trying to reduce its dependence on Chinese imports and promote domestic manufacturing. The government has launched several initiatives, including the Production-Linked Incentive (PLI) scheme, to encourage domestic electronics manufacturing. However, the study's findings suggest that more needs to be done to address the issue of component-level dependence on China.

The report's recommendations for expanding domestic upstream manufacturing and promoting critical mineral policies are crucial for reducing India's trade deficit with China and promoting domestic electronics manufacturing. By promoting domestic manufacturing and reducing dependence on Chinese imports, India can reduce its trade deficit and promote economic growth.

In conclusion, the study's findings highlight the need for India to reduce its dependence on Chinese electronics imports and promote domestic manufacturing. By expanding domestic upstream manufacturing and promoting critical mineral policies, India can reduce its trade deficit with China and promote economic growth.

The study's findings have significant implications for India's electronics and electric vehicle industries, which are heavily reliant on Chinese components. The government needs to take urgent action to address the issue of component-level dependence on China and promote domestic manufacturing. This can be achieved by providing incentives for domestic electronics manufacturing, promoting critical mineral policies, and encouraging selective partnerships where local alternatives are limited.

Overall, the study's findings suggest that India needs to take a comprehensive approach to reduce its dependence on Chinese electronics imports and promote domestic manufacturing. By doing so, India can reduce its trade deficit with China, promote economic growth, and become a major player in the global electronics industry.