India's electronics ambitions are real and well-funded. The manufacturing ecosystem accessible to Western hardware buyers is a different story.
For hardware buyers under $500k/year sourcing custom electronics, PCBs, or IoT hardware, India is not a credible alternative to China today — the manufacturing ecosystem accessible to independent Western buyers does not exist at the required breadth. The search surge for "india manufacturing" reflects real structural ambition and genuine tariff motivation, but the infrastructure and the opportunity are separated by a decade and a supply chain that still runs through Shenzhen.
What is actually driving the search surge
Google Trends shows "india manufacturing" at search interest 37 globally, rising approximately 10% week-on-week — comparable to "china manufacturing company" at 25. The reason is straightforward: US Section 301 tariffs on Chinese electronics run 25–35%, and Indian-origin goods face 0–3.5%. Buyers who have absorbed a 30% tariff hit are doing arithmetic, and India shows up in the arithmetic.
The arithmetic is correct. The problem is the next question: what can you actually buy from India?
The honest answer for most hardware buyers: finished mobile phones (if you are a carrier or large distributor), and cable harnesses. Not custom PCBAs. Not IoT module designs. Not OEM consumer electronics with your branding. Not small-batch tooled enclosures.
What India is actually manufacturing
The PLI scheme launched in 2020 and expanded through 2025 has genuinely moved the needle on mobile phone output. India's smartphone production value grew from approximately $3B in 2019 to an estimated $24B in 2025. That is real manufacturing development.
But look at who is doing it: Apple via Foxconn Vietnam Holdings and Tata Electronics in Tamil Nadu and Karnataka. Samsung in Noida. Dixon Technologies and Lava for mid-tier Android. These are Tier 1 OEMs operating in a government-incentivized ecosystem built for large-volume, standardized production.
The factories are captive lines. They are not on Alibaba. They do not respond to RFQs from hardware startups. They do not do 500-unit custom runs of BLE sensor nodes.
Outside the PLI-driven mobile assembly cluster, India's electronics manufacturing base is thin. PCB fabrication — the foundation of any electronics supply chain — is essentially absent at internationally competitive quality and price. India's domestic PCB market is roughly $3B annually; China's is over $60B. There is no Huaqiangbei. There is no cluster equivalent to the Dongguan component supply chain. The mold-making and tooling ecosystem that makes rapid product iteration possible in Shenzhen does not have a functional equivalent in India.
The component import problem
India's electronics industry imports approximately 70% of its components by value. The primary source: China.
This is the same structural issue that constrains Vietnam and every other country pursuing an electronics manufacturing build-up. The RF silicon, passives, connectors, PCB copper-clad laminates, LED packages, and battery cells that go into consumer electronics are produced at scale in China. A factory that moves final assembly to India still builds products from a Chinese supply chain — with added freight, customs processing, and lead time between the source and the assembly point.
For a product where components are 60% of BOM cost and the factory adds labor at $2.50/hr versus China's $6.50/hr, the math looks like this: if labor is 15% of total cost, cutting it by 60% saves 9% of total cost. Meanwhile, adding 2–4 weeks of ocean freight from Chinese component suppliers to the Indian assembly point costs approximately $0.80–1.50/unit in added freight and carrying cost on a typical electronics SKU. The net benefit often disappears entirely. For products where components dominate — IoT modules, PCB assemblies, RF hardware — there is no meaningful cost advantage.
Infrastructure: the honest assessment
India's logistics and power infrastructure has improved significantly since 2015. The national highway network expanded, digital customs (ICEGATE) reduced clearance times, and GST rationalized inter-state movement. These are real improvements.
They have not caught up to the Pearl River Delta. Dongguan to Shenzhen Yantian port runs 45–90 minutes. Bangalore to Chennai or Nhava Sheva (Mumbai) runs 6–12 hours minimum. Component lead times from Chinese suppliers to an Indian assembly facility add 2–4 weeks via sea freight. Air freight eliminates the lead time but adds $4–8/kg — costs that erase any labor advantage at typical electronics BOM density.
Power reliability has improved but remains variable outside major industrial zones. The Suzlon and Adani renewable infrastructure projects are expanding capacity, but brownouts in tier-2 industrial areas remain a real operational risk for electronics manufacturers with sensitive equipment.
Where India does make sense
Be specific about this rather than dismissive. India makes sense for certain electronics buyers:
Labor-intensive assembly at high volume. Cable harness manufacturing, wire harnessing, and basic box-build assembly of imported PCBAs are India's actual competitive position. Labor content above 40% of COGS, annual volumes above $1M, and a stable, standardized product design are the conditions where the arithmetic works.
Targeting the Indian domestic market. India's 1.4 billion consumers represent a real market. Manufacturers selling into India benefit from avoiding import duties (which run 10–25% on finished electronics) and from logistics advantages within the country. If your business model involves selling in India, manufacturing in India has a real case independent of export competitiveness.
Regulatory diversification requirements. Some large US retailers and institutional buyers now require demonstrated supply chain diversification as a contract condition. If your customer requires a non-China manufacturing option as a line item in their supplier agreement, India checks that box — even if the economics are not favorable.
Long-horizon development. India in 2026 is roughly where Vietnam was in 2015. The ecosystem is building. Companies with 5–10 year supply chain horizons and the resources to qualify suppliers in a developing manufacturing environment may rationally begin building India relationships now to access a more developed ecosystem in 2030–2032.
The threshold questions
Before assuming India is the tariff solution, ask these questions directly:
Does the factory for your specific product exist in India? Not "could a factory be built" — does it exist today, accept RFQs from independent Western buyers, and have a track record with products like yours? For custom PCBAs, IoT modules, and OEM consumer electronics, the answer is almost always no.
Have you run the full landed cost model including component lead time? A 30% tariff advantage disappears if components add 4 weeks of lead time and $1.50/unit in freight and carrying cost. Use the same formula on both India and China before deciding.
Is your volume above $500k/year? Below that threshold, the one-time supplier qualification cost — factory audits, NPI cycles, tooling qualification, compliance re-testing — rarely amortizes within a reasonable payback period in a nascent ecosystem.
What the search data actually means for sourcing decisions
The rise in "india manufacturing" searches reflects a legitimate question that buyers are asking. The answer is more specific than the question implies.
For finished mobile phone assembly at scale — India. For labor-intensive standard assembly at high volume — potentially India. For custom PCBAs, IoT hardware, RF modules, OEM consumer electronics under $1M/year — the manufacturing infrastructure that would make India a credible alternative does not exist today.
The tariff arithmetic is real, and it is worth modeling. But the model only makes sense when you start from what can actually be produced, not from what tariff rates suggest should be produced. See importing electronics from China to the US for a full landed cost framework, and the China tariff guide for the current Section 301 picture.
If you want to understand whether India sourcing makes sense for your specific product category and volume, the analysis starts with the product spec, not the tariff table. Our sourcing service runs comparative factory audits and landed cost models across China, India, and Vietnam. Get in touch and we can run the numbers.
