In a move aimed at diversifying the supply chain beyond China, Apple has been steadily expanding its manufacturing footprint in India over the years, and is now further accelerating the process
The journey began in 2017 when Priyank Kharge, then the Information Technology Minister of Karnataka, initiated discussions with Apple’s headquarters in Cupertino, California. Amid threats of increased tariffs on Chinese imports by then-U.S. President Donald Trump, Kharge saw an opportunity to position India as a viable alternative for Apple’s manufacturing needs.
Highlighting Karnataka’s skilled workforce and offering incentives like tax breaks, the state aimed to attract Apple’s investment. Other Indian states, including Gujarat, also vied for Apple’s attention.
Fast forward eight years, and Apple’s commitment to India has materialized significantly. Taiwanese manufacturing giant Foxconn, along with India’s Tata Electronics, has established production facilities in Karnataka and Tamil Nadu. Notably, Foxconn commenced the production of Apple’s flagship iPhone 16 Pro in India, marking a significant milestone in Apple’s collaboration with the country.
This partnership has yielded substantial benefits for India. Mobile phones have now surpassed traditional exports like diamonds, becoming the nation’s leading product export. Currently, approximately 14% of Apple’s iPhones are manufactured in India, with projections indicating an increase to 25% by 2025.
For Apple CEO Tim Cook, diversifying the company’s manufacturing base is a strategic imperative. While China has long been Apple’s primary production hub, recent geopolitical tensions and trade disputes have highlighted the risks of over-reliance on a single country.
Despite the progress, replicating China’s extensive supply chain ecosystem in India presents challenges. Currently, iPhones assembled in India rely heavily on imported components. To establish a more self-sufficient manufacturing base, India must attract a diverse array of component suppliers.
Indian conglomerate Tata Group is positioning itself as a key partner in Apple’s Indian venture. By acquiring a 60% stake in a facility in Tamil Nadu, Tata aims to become Apple’s first full-service supplier in India.
In the December quarter, the iPhone 15 emerged as India’s top-selling smartphone model, capturing a 23% revenue share and surpassing competitors like Samsung. However, in terms of volume, India’s iPhone sales still trail behind markets like China.
