More made-in-India iPhones? Apple reportedly planning to shift 18% of global iPhone production to India by 2025

Apple is reportedly considering shifting 18 per cent of its global iPhone production to India by 2025. This decision is driven by the Indian government's production-linked incentive (PLI) scheme for mobile phones, which aims to encourage companies like Apple and its vendors to expand their operations within the country. 

According to a report from Bank of America, this scheme has the potential to help India achieve its ambitious goal of tripling its domestic production to $126 billion and achieving fivefold growth in exports, amounting to $55 billion by FY26.

Recent reports indicate that Apple has already increased its iPhone production in India from 1 per cent in 2021 to 7 per cent in 2023. Furthermore, there are previous speculations suggesting that Apple aims to manufacture 25 per cent of iPhones sold globally in India by 2025.

Bank of America's report emphasises that mobile phones account for 21.5 per cent of India's domestic demand for electronics, which is experiencing substantial growth at a rate of 15 per cent compound annual growth rate (CAGR). In FY2023 alone, India consumed electronic goods worth $158 billion, representing an 11 per cent CAGR growth over the period FY17-23.

However, despite the significant demand, a large portion of the supplies is currently met through imports. In FY23, India's electronics imports amounted to $77 billion, making it the second-largest import bill and contributing to 20 per cent of the country's trade deficit.

The report points out that approximately 70 per cent of the mobile phone's cost, including components like the display, memory, and semiconductors, is challenging to localise. Achieving such localisation would require substantial capital expenditure and access to high-end technology.

The report also highlights the positive impact of the Rs 38,000-crore PLI scheme, which has contributed to enhancing the export mix in local production. As a result of this scheme, electronic exports have grown from 16 per cent to 25 per cent year-on-year. These developments have positioned India as a reliable global supply chain option for mobile phone and electronics manufacturers.

Apple has recently established its first two exclusive retail stores in Mumbai and Delhi, with CEO Tim Cook personally inaugurating these outlets in April. As part of its expansion strategy, the company reportedly plans to open three additional stores in India by 2027.

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