Why choose India for your supply chain, and not China?

The global electronics industry is undergoing a major transformation as companies look to diversify their supply chains. Traditionally, China has dominated the sector, but more and more French and European companies are now looking to India. Here’s why sourcing electronics from India has significant advantages over China.

Geopolitical Relations - Geopolitical relations play a crucial role in choosing trading partners. Currently, trade tensions between the United States and China have an indirect impact on Europe. On the other hand, India has more stable diplomatic relations with France and the European Union, which reduces the risks of disruptions due to trade conflicts. India is also a member of various regional trade agreements that facilitate trade with Europe.

Distances and Logistics - The distance between France and India is less compared to that between France and China, which is an advantage in terms of transportation time and costs. The time difference with India is only 3.5 hours, compared to 7 hours with China, facilitating real‑time communications and trade operations. India has several major port hubs, such as Mumbai, Chennai, and Cochin, offering modern logistics infrastructure and efficient global connectivity. In comparison, Chinese ports like Shanghai and Shenzhen are often congested, which can lead to delays. India's logistics advantages allow for more reliable and on‑time deliveries, reducing the risk of stockouts.

Customs Tariffs - Customs tariffs play a major role in import costs. India has favourable trade agreements with several European countries, reducing tariffs on electronic components. These agreements make importing electronics from India more economical compared to those from China, where tariffs may be higher due to ongoing trade tensions.

Indian Government Investments in Electronics Sector - The Indian government has launched several initiatives to promote the electronics industry, such as the Make in India program and the Production Linked Incentive (PLI) scheme. These schemes aim to attract foreign investment and encourage local manufacturing of electronic components. As part of these efforts, the government has committed to invest over $10 billion in the electronics sector over the next five years. India is also planning significant investments in technology infrastructure and skill building, thereby strengthening its position as an electronics manufacturing hub.

Sourcing electronics from India has many advantages over China for French companies. Comparable logistics distances, more stable geopolitical relations, advantageous customs tariffs and sustained investments from the Indian government make India particularly attractive for European companies. India has therefore become a key destination today to secure its supply chains while continuing to buy at competitive prices.