Surprise surge in Indian electronic exports to China, shipments rise nearly 40%: Report

Driven by an unprecedented global expansion in artificial intelligence and data-center infrastructure, India is unexpectedly shipping more manufactured electronics to China. Indian exports to its northern neighbor jumped almost 40% in the five months through August, with electronics and engineering goods taking center stage, as reported by Bloomberg.

The surge highlights a shifting dynamic in a trade relationship long dominated by Chinese goods. Indian electronics shipments to China tripled to $3.18 billion in the fiscal year ended March, led by printed circuit board assemblies, smartphones, display modules, and telecom equipment. That momentum carried into the current fiscal year, with electronics shipments rising more than 15% between April and August compared to the previous year, as per the report.

“The surge in exports to China is partly driven by pressure on suppliers to meet the demand for high-end equipment required for AI-related products and as data centers proliferate,” said Rajoo Goel, secretary general of the Electronic Industries Association of India told Bloomberg. “This has encouraged exports of electronics from India to China.”

For New Delhi, the sudden uptake supports a prolonged domestic push to build manufacturing capability and embed Indian firms deeper into international supply chains. The shift coincides with efforts by New Delhi and Beijing to mend diplomatic ties after reaching multi-decade lows, alongside shifting US tariff strategies that offer both Asian powers reason to deepen commercial ties.

“It shows that Indian manufacturing is beginning to win credibility in one of the world’s most competitive global value chains,” Pankaj Mohindroo, Chairman of Indian Cellular and Electronics Association, told Bloomberg.

The gains, though modest relative to total trade, suggest Beijing may be opening up to Indian exports amid broader geopolitical recalibrations, Arun Kumar Garodia, MD at Corona Steel Industry Pvt, told Bloomberg.

Discrepancies remain in how the growth is recorded. Chinese customs data does not reflect a matching surge in arriving printed circuit boards, showing the volume instead under smartphones and telecom products. Executives attribute the difference to varying product classification methods between the two nations.

Despite the recent growth, China remains a small destination for Indian exports overall. It accounted for 4.4% of India’s total exports in the year ended March, up from just over 3% the prior year, whereas the U.S. remains India’s largest destination at nearly 20%.

The growth has done little to alter the deep trade imbalance between the two economic powers. India imported $131.6 billion in Chinese goods during the fiscal year ended March — representing nearly 17% of total imports — overshadowing its sales to China.

Exporters remain optimistic about maintaining the trajectory beyond technology shipments. Engineering exports to China, including machinery, automotive parts, hand tools, and components, grew roughly 21% from April to August year-over-year.