Apple’s quiet shift to India
Raunaq Mohammad
2nd March 2025
Written by Raunaq Mohammad
As Donald Trump was preparing to take office for the first time in 2017, Priyank Kharge was busy making calls to Apple’s headquarters in Cupertino California, from Bengaluru, the city known as India’s Silicion Valley.
With the US president threatening to unleash a wave of tariffs against China, Kharge, the information technology minister of the southern state of Karnataka, seized the opportunity to woo one of the world’s biggest companies.
His mission was to convince Apple, whose manufacturing fortunes are prominently tied to China, to set up its first IPhone production plant in India.
In his proposal, the official vouched for Karnataka’s rich talent pool and amenities such as tax breaks that Apple could tap if it started making iPhones there. Other states including Gujarat were also proposed as potential plant locations for technology giant.
For India, this is an important shift as mobile phones have now surpassed diamond’s as the country’s biggest export product. Although only around 15% of Apple’s iPhones are currently made in India, this is expected to increase to 25% by 2027 according to JPMorgan and Bank of America analysts. Globally the company shipped around 232 million iPhones in 2024 alone according to the International Data Corporation.
For Apple’s CEO Tim Cook, the geopolitics surrounding the shift are tricky. Apple, which is intensely secretive about its supply chain needs to be wary of antagonising China on which this shift in production still largely depends on.
“Its very hard to build 35 million less phones in China and not be noticed, but they are doing this in the least public way possible”, says Wamsi Mohan, senior equity research analyst at the Bank of America.
However, despite Apple’s best efforts, their growing business in India is viewed with suspicion in China. Beijing has recently hampered the movement of some Chinese technicians and capital goods into India.
The IPhones currently made in India are still largely assembled using flown-in parts. To become more ambitious and bolster Apple’s long-term presence, manufacturers of components will have to be lured to the country with similar revenue opportunities as those found in China.
Other aspects of Apple’s success in China, notably a steady supply of mobile and trained female workers which is providing to be a challenge to replicate in India.
Apple does have keen and powerful partners however: Tata, a leading business is positioning itself as Apple’s first full service supplier in India.
However, the 157 year old group is a relative newcomer to electronics and will need to evolve quickly to make the partnership a success.
It will also take time for relevant government authorities in India to figure out how Apple works and vice versa and for both sides to develop the kind of conversations over regulatory issues that Apple has had in China.
