India’s smartphone exports are in trouble due to US-Iran war, exports may fall by 25%: – ..

News India Live, Digital Desk: The impact of the clouds of war looming over the land of the Middle East and the increasing tension between America and Iran has now gone beyond the borders and has reached the global markets. India, which is fast emerging as the world’s new smartphone manufacturing hub, could be vulnerable to this geopolitical instability. Experts believe that if this tension continues for a long time in the Gulf countries, then the export of smartphones made under ‘Make in India’ will decline. 22 to 25 percent A huge decline of up to Rs.

The real reason for the huge decline in exports

The biggest challenge for India’s smartphone export sector is the disruptions in logistics and supply chain. War may result in restrictions on airspace and increased risk of major shipping routes being closed or diverted.

Delivery Delay: Non-delivery of goods on time will not only lead to financial loss, but the use of alternative routes will also increase the cost of shipping manifold.

Rising expenses: The increase in logistics expenses will have a direct impact on smartphone prices and companies’ profits.

Dependence on UAE becomes the biggest challenge

The United Arab Emirates (UAE) is the largest transit hub for smartphone exports to India. According to data, every export from India about 4 out of 10 phones First go to UAE, from where they are re-exported to other parts of the world. UAE is India’s second largest export destination after America, with an annual turnover of around Rs. 3.1 billion dollars Is. Any unrest in the Gulf region will directly impact India’s export figures.

The crisis of small exporters versus giants like Apple

The impact of this Middle East crisis will not be the same on every company:

Big players (Apple): Large companies like Apple have a highly diversified and strong supply chain network. They can take out their goods through other routes if needed. Currently Apple is making about 25% of its global production in India.

Small Exporters: This situation can be distressing for small traders as they depend on selected trade routes only. They are facing a huge risk of accumulation of inventory and stuck goods.

Way forward and risk management

India’s manufacturing base is undoubtedly strengthening, but the crisis in the Middle East is a reminder of how important risk management and alternative trade routes are to become a ‘global supplier’. At present, Indian exporters are in a ‘wait and watch’ situation. If tensions do not ease, the industry will have to prepare for changes in shipping routes and rising costs. However, India’s strong global partnerships have the capacity to weather this economic storm.