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With US tariffs squeezing Chinese exports, surplus inventory is pushing Chinese firms to offer discounts, opening doors for price talks
With the trade spat between China and US, experts believe Indian firms may benefit from the resulting trade disruption.
Several Chinese electronic component manufacturers are offering discounts of up to 5 per cent to Indian companies as trade tensions between the US and China escalate, according to a report by The Economic Times on April 10. The move could make consumer electronics such as phones, TVs, and appliances more affordable in India.
Indian electronics manufacturers are reportedly considering passing on part of the cost savings to consumers in a bid to boost demand, the report said.
The latest developments follow a rapid escalation in the US-China trade conflict. On April 2, President Trump imposed steep reciprocal tariffs on Chinese imports. China retaliated with a 34% tariff on American goods, prompting the US to raise its tariffs to 104%, and then to 125% on April 9. In contrast, Trump announced a 90-day pause on tariffs for countries that did not retaliate, triggering a global market rally.
Amid the uncertainty, Indian firms could stand to gain. With Chinese exports to the US under pressure due to high tariffs, manufacturers in China are left with surplus inventory, making them more open to price negotiations.
“This opens up opportunities for Indian importers to renegotiate component prices,” Kamal Nandi, head of the appliance business at Godrej Enterprises Group, told the publication.
Avneet Singh Marwah, CEO of Super Plastronics, told The Economic Times that the oversupply has caused panic among Chinese firms. “As Indian companies place fresh orders starting May-June, some of the negotiated discounts are likely to be passed on to consumers,” he said.
This comes shortly after the Indian government approved a Rs 22,919 crore Production-Linked Incentive (PLI) scheme for passive electronic components on March 28, aimed at boosting domestic manufacturing and reducing dependency on imports.
