India has emerged as a key supplier of smartphones to the United States, meeting about 40 per cent of the demand that was earlier fulfilled by China, according to a recent report by McKinsey & Company. The report highlighted that the United States has been actively diversifying its import sources and managed to replace about two-thirds of the goods it previously sourced from China, valued at more than $80 billion.

India and ASEAN economies have played a significant role in this shift. It stated, "India, for example, increased smartphone exports to the United States to levels equal to roughly 40 per cent of what China had supplied". The report also mentioned that India's rise in smartphone exports has been particularly notable, with shipments to the United States increasing sharply despite the long geographical distance of around 13,000 kilometers.

This reflects India's growing role in global electronics manufacturing and supply chains. At the same time, ASEAN economies replaced about two-thirds of US laptop imports that had earlier come from China, indicating a broader shift in manufacturing bases across Asia. The report also noted that global trade remained resilient in 2025, despite concerns of slowdown. Both US imports and Chinese exports reached new highs during the year, while overall global trade grew faster than the global economy.

Among emerging economies, India stood out for expanding trade across regions. However, the report pointed out that while India's overall exports remained largely unchanged, smartphones were a key exception, driving growth in exports. The shift in trade patterns is largely being driven by domestic priorities and geopolitical realignments. Advanced economies and China are increasingly reorienting trade away from geopolitically distant partners, while emerging economies like India continue to expand trade across the spectrum.

Other economies have also seen notable changes. ASEAN strengthened its position as a manufacturing hub by importing more inputs from China and exporting finished goods to the US. Brazil expanded commodity exports to China, replacing goods that China had earlier sourced from the US. So the report suggests that India's ability to capture around 40 per cent of the US smartphone demand previously met by China marks a significant shift in global trade dynamics.

Published on April 17, 2026