India is solidifying its position as a significant hub for Apple's iPhone manufacturing, reflecting a strategic shift in global electronics supply chains. Industry estimates suggest that approximately 55 million iPhones were assembled in India in 2025, marking a 53% increase from the previous year and accounting for roughly a quarter of Apple's worldwide production.
This expansion is driven by Apple's efforts to diversify its manufacturing base beyond China, influenced by factors such as US tariffs, geopolitical tensions, and supply-chain vulnerabilities. Manufacturers like Foxconn, Tata Electronics, and Pegatron are key players supporting this production surge in India, now assembling various iPhone models, including premium variants.
Assembly vs. Value Capture
Despite the impressive volume, the economic value captured by India primarily through assembly remains relatively small. An illustrative breakdown of a hypothetical $1,000 iPhone reveals this disparity:
- Apple: $450 (design, software, brand value)
- Taiwan (chip suppliers): $150
- South Korea (memory, display): $90
- Japan (camera systems): $85
- US (component firms): $80
- India & China (assembly): $30 each
These figures highlight that assembly is just one segment of a complex global value chain. The substantial value lies in advanced technologies, research, intellectual property, and specialized manufacturing capabilities required for components like semiconductors, memory, displays, and camera systems.
Moving Beyond Assembly
India's production-linked incentive (PLI) scheme and US tariffs on Chinese goods have been instrumental in encouraging the manufacturing shift. However, to truly increase domestic economic value, India needs to move beyond mere assembly.
Expanding local sourcing for components, rather than relying heavily on imports, is crucial. While Apple has begun localizing production for items such as batteries and enclosures, and its ecosystem is extending to products like AirPods, a deeper supplier base requires significant investment in technology, skills, infrastructure, and advanced production capabilities.
The current electronics trade data underscores the challenge: India's electronics imports stood at $116 billion in the last financial year, dwarfing exports of $48 billion. While Apple's manufacturing expansion supports employment and industrial capacity, the reliance on imported components limits the value retained within the country.
The next strategic phase for India's electronics sector must focus not only on attracting more assembly lines but also on cultivating a robust component manufacturing ecosystem, strengthening local suppliers, and integrating into more technology-intensive segments of the value chain.