The iPhone boom is driving India’s electronics exports to record highs, set to overtake oil
India’s electronics exports are growing rapidly and have strengthened their position as the third – and fastest growing – overseas sales category in the first six months of FY26, Commerce Ministry data shows. Experts say they could be on track to overtake exports of petroleum products in two years, amid curbs on purchases of Russian oil, and take second place after engineering products.
The electronics category was number 7 on the list of exports in FY22.
It was the fastest growing in the top 10 categories in the year ending March. Since then, it has accelerated further, becoming the fastest in the first six months of the 26th fiscal year out of all 30 export categories.
In its race for third place, electronics ousted gems and jewelry and chemicals from third and fourth place in FY25. Earlier, in its rise to No. 3 from No. 7 in FY22, it surpassed drugs and pharmaceuticals and ready-made garments.
According to half-yearly export data released by the Commerce Department, electronics exports rose 42% to $22.2 billion — about half of which went to Apple’s iPhones — from $15.6 billion a year earlier. Petroleum products fell 16.4% to $30.6 billion from $36.6 billion. Engineering led the way with $59.3 billion, up 5.35% from $56.3 billion a year earlier. Oil, which is still India’s second largest export category, is declining – from $97.4 billion in FY23 to $63.3 billion in FY25. Electronics exports have jumped 63% over the past three years – from $23.5 billion in FY23 to $38.5 billion in FY25. “At the current pace, electronics exports from FY23 to FY26 will double,” the analyst said.
The oil is not good
Some experts said oil exports could see a faster decline as U.S. sanctions put money on cheap Russian crude, taking away a cost advantage from Indian refiners. “Exports have been falling despite the price advantage caused by Russian oil in the past few years. When that advantage is no longer available, exports may suffer more,” said one of them.
The gap between oil and second-place electronics narrowed in the first six months from $73.9 billion at the start of the PLI to $24.7 billion in FY25. This is likely to narrow to $16 billion in FY26, experts said.
While petroleum products will retain the third position in FY26, at the current growth rate, electronics could replace petroleum as India’s second largest export by FY28. However, much will depend on how India’s oil trade changes in response to the US administration’s stance on Russian oil.
Electronics has been the largest export category for China for several years. India is also looking to make electronics its strength amid geopolitical currents that are persuading global firms to diversify their supply chains, experts said.
The PLI scheme for smartphones has been the main driver behind the surge in electronics exports, with Apple, Samsung and local contract manufacturer Dixon Technologies among those using financial incentives to boost production and exports. Apple has made India its second iPhone manufacturing base after China. The share of Indian-made iPhones in global sales has been growing steadily, with more than a fifth now being shipped from India.
In the first six months of the current fiscal year, Apple shipped a record $10 billion worth of iPhones. They accounted for more than 75% of US$13.4 billion in smartphone exports and 45% of US$22.2 billion in total electronics exports.