Winning Bizness Desk
Mumbai. Apple is planning to shift the manufacturing of all iPhones sold in the United States to India by 2026, significantly reducing its dependence on China. As per a *Financial Times* report, the decision follows ongoing tariff tensions, including actions taken by former US President Donald Trump that imposed heavy tariffs on imports. Currently, China accounts for nearly 28% of Apple’s global iPhone shipments, but this figure is set to decline as Apple accelerates its supply chain diversification strategy.
India to Produce Over 60 Million iPhones Annually
By the end of 2026, India is expected to produce more than 60 million iPhones annually, doubling its current manufacturing capacity. Apple has been steadily increasing its investment in India over recent years to build a robust alternative to its Chinese supply chain. If Apple completes the transition by late 2025, this production milestone could be achieved as early as 2026. The move is aimed at minimizing operational risks from geopolitical disruptions and trade disputes.
Production Growth and Export Surge
Between March 2024 and March 2025, Apple produced iPhones worth $22 billion (approximately ₹1.88 lakh crore) in India—a 60% jump from the previous year. Out of this, $17.4 billion (about ₹1.49 lakh crore) worth of iPhones were exported. Currently, one out of every five iPhones sold globally is made in India. Manufacturing is concentrated in Tamil Nadu and Karnataka, with Foxconn, Apple’s largest contract manufacturer, leading the production. Other partners like Tata Electronics and Pegatron also play a key role.
Sales and Market Potential in India
Despite Apple holding just 8% market share in India, its smartphone revenue touched $8 billion in FY 2024. iPhones remain aspirational among India’s growing middle class, indicating significant market expansion potential. Local production not only reduces costs but also allows Apple to better serve the Indian market, which is among the fastest-growing smartphone markets globally. This strategy is expected to strengthen Apple’s foothold in India over the next few years.
Why Apple is Betting Big on India
Several factors are driving Apple’s shift towards India. First, the geopolitical and logistical risks associated with overdependence on China, especially during events like COVID-19 lockdowns and trade disputes, have pushed Apple to diversify. Second, India offers a cost advantage with cheaper labor and lower import duties on locally assembled products. Additionally, government incentives such as the Make in India and Production-Linked Incentive (PLI) schemes have further attracted Apple’s manufacturing partners to invest heavily in India.
Export Advantages and Workforce Development
India’s export-friendly environment offers Apple financial benefits as 70% of the iPhones made in India are shipped overseas. In 2024 alone, iPhone exports from India reached $12.8 billion (around ₹1.09 lakh crore), with further growth projected. While India’s workforce still lags behind China in terms of technical experience, this gap is narrowing. Partners like Foxconn are investing in training programs and infrastructure development, including a $2.7 billion (₹23,139 crore) facility in Karnataka to meet production demands.
This manufacturing shift is set to reshape Apple’s global production strategy, positioning India as a critical hub for both domestic sales and international exports.
