More than one in ten iPhones are now made in India
Local reports claim Apple in India is already generating millions at its stores.
iPhone manufacturing in India continues to accelerate, and now 14% of all the iPhones sold worldwide are being made there, India’s government claimed this week.
The speed with which Apple is expediting manufacturing there reflects the strategic significance of the shift, and also bodes well for the government’s attempt to get more tech firms to make more products there. The decision to make further cuts in tariffs on imported smartphone components will only help accelerate this pattern even more.
More than one in ten iPhones are now made in India
“Apple assembled USD 14 billion worth of iPhones in India during FY’24, constituting 14 per cent of its global iPhone production,” the Economic Survey said citing third-party data. Smartphones are now one of India’s top five export items, the Survey also said, making India the world’s sixth-largest smartphone exporter.
What’s interesting also is that at domestic production of these devices accelerates, domestic demand for smartphones is also increasing fast. From c. $8b in demand in 2016 to c.$49b in demand in FY24, according to the report. That’s a growth worth c.$5b a year, and Apple is grabbing a healthy slice of that growing market, and reflects the scale and speed of smartphone penetration in the market there.
India is seeing benefits from its approach
“India’s share in world electronics exports has improved from 0.63 per cent in 2018 to 0.88 per cent in 2022. As such, India’s exports (ranking) rose from 28th in 2018 to 24th in 2022 in global electronics exports. The share of electronics goods in merchandise exports of India rose from 2.7 per cent in FY’19 to 6.7 per cent in FY’24,” the survey said.
China + 1 explained
It also observed some of what motivates these changes:
“Over the last five years, a seismic change has occurred in the global manufacturing realm, with major multinational companies, including Apple and others, looking to ‘de-risk’ themselves from China, which was traditionally known as the ‘world’s factory’.
“This shift is primarily due to disruptions caused by COVID-19, growing tensions between the US and China, and rising costs of doing business in China.
“As a result, several companies have adopted a ‘China plus one strategy’ to reduce their reliance on China for high-tech electronic products and components. This approach involves supply chain decisions to decrease their risk exposure to China.
“For example, over 90 per cent of manufacturers in North America surveyed by the Boston Consulting Group in 2023 moved some or all of their production to other countries like Mexico, Thailand, and Vietnam, suggesting a move away from China.”
As these cards fall, India is expected to become Apple’s third largest market within the next two or three years, joining China and the US in the top three.
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