With US-China trade tensions escalating, the Trump administration has hiked tariffs on Chinese imports to as high as 245%, sharply increasing pressure on Chinese exporters. In contrast, Indian goods entering the US still face a modest 10% tariff during the current grace period. This, combined with deepening US-India ties under the Indo-Pacific strategy, is driving a wave of Chinese companies to shift production to India as they seek localized manufacturing and alternative export bases.
India emerges as a haven for China's manufacturing sector
As global supply chains undergo realignment, India has emerged as a top destination for Chinese manufacturers, buoyed by growing strategic and trade cooperation with the US.
Chinese exports face punitive triple-digit tariffs in the US, while Indian goods benefit from a far lower 10% rate—an increasingly attractive proposition for Chinese firms planning offshore expansions.
Industry sources note that the dual pressures of tariff avoidance and global market access are pushing Chinese firms to position India as a re-export hub under the "Made in India" label, easing entry into the US and EU markets.
Lenovo commits to 100% local manufacturing in Indian PC market
Chinese PC giant Lenovo is leading the charge into India. At its recent "Lenovo Tech World India" event, the company announced plans to fully localize PC production in the country within three years. Lenovo will also partner with Indian AI startup Krutrim to build what it claims will be India's largest supercomputer.
Lenovo India Managing Director Shailendra Katyal said roughly 30% of its PCs in India are currently made in India, with a goal of reaching 50% by 2025 and full localization—including AI PCs—by 2027. The company also plans to export these products to global markets.
Analysts say Lenovo's India strategy not only offers a way around US-China tariffs but also aligns with New Delhi's push for local manufacturing and foreign investment.
Appliance makers follow suit: Haier, Hisense accelerate local investment
Outside the ICT sector, Chinese appliance brands are also deepening their India bets. Haier plans to invest over INR 10 billion (approx. US$120 million) over the next three to four years to expand its domestic manufacturing footprint.
Credit: AFP
From 2024 to 2028, Haier will build a new factory in southern India, adding air conditioner and plastic injection lines. Its target: become a US$2 billion player in the Indian appliance market.
Hisense is also ramping up its India focus. In December 2024, the company partnered with Reliance resQ—an after-sales unit of Indian retail giant Reliance Retail—to strengthen its distribution and customer support network.
According to The Economic Times, Hisense is also eyeing a stake in a local appliance manufacturer, which would become a key production base for air conditioners, refrigerators, and washing machines.
From Lenovo to Haier and Hisense, Chinese manufacturers are accelerating India-focused strategies amid growing geopolitical risks and shifting trade flows. As US-India ties strengthen, India is leveraging its lower tariffs to lure Chinese tech and appliance firms looking for supply chain resilience and global market access.
Article translated by Levi Li and edited by Joseph Chen
