top of page

The Apple of India's Eye; By Swetha Ratnasabhapathi

Image Courtesy: ZEE NEWS

Article 46/2022

Early last month the iPhone mogul Apple Inc. made public its plans to manufacture its new iPhone 14 in India. The news has been with no qualms, receiving much fanfare since then. But how far can India benefit from this move and what are the implications for India are the major issues to be focussed on. To concur that this move is a major victory for India to overtake China in the manufacturing race immediately is nothing but wishful thinking. India only constitutes about 1.5% of Apple’s global device sales producing about 3 million iPhones last year, while China produced a staggering 230 million [1]. However, iPhone export production from the country to Europe and Middle East is set to double to $2.5 billion by March 2023 from $1.3 billion in March 2022 [2]. Hence, this move by Apple does have positive implications for India.

Apple started its foray in India in 2017 with assembling iPhone in Foxconn facility with the iPhone SE model and models that were to be sold within the country. Apple’s initiative to manufacture a new model, the iPhone 14, just months post its launch shows the capabilities of the Indian manufacturing environment. This is the first time that Apple has ventured to produce a new model outside of China just months after its release.

Apple in its process to decouple from China is eyeing countries like India and Vietnam to move its production and diversify its supply chain. Vietnam is ahead of India in the race for manufacturing and of Apple products. Vietnam is already Apple’s most important production hub outside of China producing many of its flagship products like the iPads and EarPods. According to a report by JP Morgan by 2025, Vietnam will be supplying 65% of AirPods, 5% of MacBooks, 20% of iPads and Apple Watches [3]. Vietnam’s ease of doing business and its Industrial policy make it a more probable place for companies. India, a relatively new entrant to the race in comparison, has much to reap from this in the future.

The silver lining in the whole process is the joint venture initiatives that have stemmed from Apple's move. The Indian salt to software conglomerate Tata industries is up for a joint venture with Wistron, a Taiwanese based Original Design Manufacturer (ODM) of Apple iPhones. The other such venture that will prove heavy winds for India is the venture between Vedanta and Foxconn. The company is looking to manufacture iPhones in Maharashtra. They are also in plans to set up a semiconductor plant at Gujarat at a whopping $19.5 billion dollars. These joint venture between the companies is unique to Apple manufacturing in India. Though Vietnam has joint ventures with Foxconn for electric vehicles and SEA logistic partner, such a venture focusing on electronic manufacturing is nil. This is the area where India can storm ahead. The Tata group which has the specialised Tata Electronics Pvt Ltd a greenfield venture of the Tata group with expertise in manufacturing precision electronic components, is investing $1.5 billion in setting up a mobile phone and component manufacturing plant in Krishnagiri, Tamil Nadu.

This move by an Indian company coupled with the news of its joint venture with an accredited iPhone ODM manufacturer Wistron will propel India forward in its race to cement India’s position in the sector. This joint venture will pump in the much-needed expertise and knowledge which India can benefit from in developing an indigenous sector producing world class ODM facilities.

India is one of the largest producers of Samsung phones in the world. India even has the biggest Samsung manufacturing facility in the world based on production capacity in the world. Despite this why does the manufacturing of iPhones become important?

With Apple and other industries looking to move away from Chinese supply chains, an indigenous well developed semiconductor industry in India will further link up with the productions of smartphones from the country, cutting on import duties and logistics for the companies. India can thereby develop into a complete smartphone manufacturing hub in the future.

India has largely been producing iPhones that cater to its domestic market, though the share of its exports is on the rise. iPhone is the most used premium smartphone in the world, dominating global sales with 62% of the global premium smartphone market sales in Q1 of this year, even when the global economy is slowing down. This is an increase of 5% from the year before, the Q1 of 2021. The Apple iPhone also dominates in the ultra-premium segment, capturing two-third of its sales worldwide. This segment witnesses a year-on-year growth rate of around 164%. The premium iPhone sales constitute about two-third of the global smartphone sales offsetting the mid to normal range phones in value [4]. It is interesting to note that during times of economic slowdown, be it even during the global financial crisis of 2008, Apple recorded a 47% earning leap in Q4 of 2009 from a year ago of Q4 of 2008, thanks to the sales of iPhone SC [5]. Even in the current post Russia-Ukraine crisis induced global slowdown Apple iPhone sales have done well. The continued demand for the premium iPhone stems from the affluent customer base who are not affected by the economic turnarounds. This unwavering customer base is what India should look to tap into. The rise of indigenous Indian production which is now self-sufficient to sustain iPhone sales within the country should look to next target this population which offers viable export options. This would give India the opportunity to have a set of stable exports, despite economic whirlwinds, to a targeted population. This stability is what makes manufacturing of iPhones important to India.

With the production of iPhones, the semiconductor industry in the country has the potential to fillip as well. The joint venture between Vedanta and Foxconn to produce semiconductors in the country is a shot in the arm for the country. India is also looking to capitalise on this front and has put forth the ‘India Semiconductor Mission’.

With Apple and other industries looking to move away from Chinese supply chains, an indigenous well developed semiconductor industry in India will further link up with the productions of smartphones from the country, cutting on import duties and logistics for the companies. India can thereby develop into a complete smartphone manufacturing hub in the future.

The Production Linked Incentive (PLI) Scheme for large scale electronics manufacturing, especially targeted towards manufacturing of mobile phones, components and IT hardware, that the government introduced in 2020 to woo companies looking to move away from China, offers 4% to 6% incentive on incremental sales produced in India. The top three iPhone manufacturing companies in India Foxconn, Wistron and Pegatron are all part of this scheme. As per projections thanks to the PLI scheme Apple’s contract manufacturers are to make iPhones worth Rs 47000 in India in FY 2023. Industry insiders believe that there will be iPhone shipments worth around 7 million units this year, which pushes its global share to 5.5% [6]. Though this spur in production brings in much needed forex in the country it will also boost the demand for semiconductors.

The growth in manufacturing and the opening up of all these industries opens up varied employment opportunities. India would do well to take a leaf out of China’s book and improve the vocational education in the country. These industries will also open up opportunities for skilled workforce. Given the positive demographic dividend that India possess apt skill development and vocational education to the suitable population can also bridge the unemployment rate in the country.

For a country with so much potential the glaring drawback is the absence of an updated Manufacturing Policy. The National Manufacturing Policy, 2011 that the country has does not reflect the present realities of the world. A manufacturing policy focussing on the front-end and back-end manufacturing process along with the actual manufacturing process, making India a supply chain hub is the need of the hour. Apple contract manufacturers are infamous for the rights record of their workers. India would do well to not let such incidents affect its image. The suspected case of the involvement of the Chinese aid to the left leaning workforce in Foxconn factory in Tamil Nadu, India causing unrest poses a new dimension of problems that India has to recon with.

India leaped from primary to the service sector in its growth graph negating the manufacturing sector all these years. With the electric and the semiconductor industry being the future of global manufacturing, India is in the right juncture to make use of this opportunity. The country also has the right framework to make the best use of this scenario. Thus, the onus is on India to not miss this bus to global electrical dominance of the iPhone in the future.

(Ms. Swetha Ratnasabhapathi is a research officer at C3S. The views expressed are those of the author and does not reflect the views of C3S.)


[1] Dasgupta. (2022, October 4). Iphone India: iPhone manufacturing: can India pip China anytime soon? - The Economic Times. The Economic Times. Retrieved October 12, 2022, from

[2] Hardwick, T. (2022, October 4). iPhone Exports From India Set to Double to $2.5 Billion YoY by March 2023 [Updated] - MacRumors. MacRumors. Retrieved October 12, 2022, from’s%20sources%2C%20shipments,the%20year%20through%20March%202022.

[3] Nguyen, T. (2022, October 5). 14% of Apple’s partners have factories in Vietnam. Vietnam Insider. Retrieved October 12, 2022, from

[4] Hilliard. (2022, June 23). iPhone dominates premium smartphone market with 62% of sales in Q1 2022 | AppleInsider. AppleInsider. Retrieved October 12, 2022, from

[5] Caulfield, B. (2009, October 19). Apple Kills Recession. Forbes. Retrieved October 12, 2022, from

[6] PLI Scheme: Apple on a roll in FY23, Rs 47,000 crore of iPhones may be Made in India. (2022, April 28). TimesNow. Retrieved October 12, 2022, from

77 views0 comments


bottom of page