India should ally with Vietnam, Taiwan, Japan to reduce dependence on Chinese supply chain

India is working on every loophole to curb the dependence on Chinese supply chain. It has emerged as a leading exporter of smartphones driven by financial support given by the government under the production-linked incentive scheme. However, India’s mobile phone manufacturing remains dependent on Chinese equipment and components. The recent informal restrictions by China on export of critical minerals and with withdrawal of technical personnel has posed a challenge for India’s competitiveness in Phone manufacturing.

Although, India needs to develop local component ecosystems to reduce dependencies on China-dominated supply chains.

The Indian smartphone industry has long been dominated by global players because of two factors- control of advanced component supply chains and ownership of the software layer.

While Indian brands made early inroads in assembly and distribution, they lacked deep investments in R&D, operating systems development and vertical integration. As a result, most devices are rebranded imports, limited differentiation and long-term competitiveness.