Apple Predicted to Produce iPhones Valued at 3,360 Billion Indian Rupees in India by FY26
Let's talk tech: Apple's iPhone production in India is about to skyrocket! 📈🇮🇳
By the end of FY26, Apple's iPhone production in India could reach a staggering $40 billion (around Rs 3,36,000 crore)! Why's that, you ask? Well, it's all part of Apple's plan to diversify its global supply chain away from China in response to growing geopolitical tensions and trade tariffs.
According to industry estimates, this move will enable Apple to meet 80% of its iPhone demand in the US and cater fully to India's growing domestic market. In fact, the majority of iPhones sold in the US during the current quarter are expected to be made in India, as revealed by Apple CEO Tim Cook during the company's Q2 2025 earnings call!
"For June, we do expect the majority of iPhones sold in the US will have India as their country of origin," Cook said, attributing this pivot to reciprocal tariffs imposed by the US government that are reshaping production strategies.
But it's not just India. Vietnam is also emerging as a key manufacturing hub for Apple products. For example, almost all iPads, Macs, Apple Watches, and AirPods sold in the US will now come from Vietnam.
While the exact long-term implications of these tariffs remain uncertain, Apple anticipates a $900 million impact from US tariffs in the current quarter. "We are not able to precisely estimate the impact of tariffs, as we are uncertain of potential future actions," Cook added during the call.
This shift towards India is more than just a move to avoid tariffs, though. It's a reflection of Apple's deepening investment in India's electronics manufacturing sector, which has seen a remarkable boom under the government's production-linked incentive (PLI) scheme. In fact, smartphones became India's top export category in FY25, touching a record Rs 2 lakh crore in value.
Apple was the largest contributor, with iPhones making up almost 70% of the total smartphone shipments from the country. In addition to expanding manufacturing, Apple is also plotting to open more retail stores later this year, adding to the two already operational in India. The company recently set a quarterly sales record in the Indian market and reported strong momentum across products and services.
Now, let's dig a little deeper into the numbers. In FY2025, Apple assembled $22 billion worth of iPhones in India, a 60% YoY increase, with 20% of global iPhone output now originating from India. $17.4 billion of the $22 billion production is exported, primarily to the US. The key players in this production are Foxconn (Tamil Nadu) and Tata Electronics (via Wistron/Pegatron acquisitions), with Tata's Hosur plant recently launching older iPhone models.
Apple aims to shift all US-sold iPhone assembly to India by 2026, covering around 60 million units annually. The iPhone 17's New Product Introduction (NPI) phase will be managed in India, signaling deeper localization. Foxconn's Bengaluru plant ($2.6 billion) will start iPhone 16/16e production in May 2025, targeting 50,000 jobs by 2027. By FY2026, the projected output could reach $40 billion annually, with 80% ($32 billion) destined for the US.
This transition positions India as a cornerstone in Apple's global strategy, though success hinges on overcoming supply chain gaps and maintaining geopolitical stability. However, China still dominates iPhone components, and rapid improvements in labor training, logistics, and quality control will be necessary to scale production to $40 billion by 2026. Nonetheless, this move marks a pivotal moment in global electronics manufacturing, driven by geopolitical tensions and India's emerging manufacturing ecosystem.
- By 2026, Apple's iPhone production in India is projected to reach $40 billion, a significant portion of which will be used to cater to the US market.
- In the current quarter, the majority of iPhones sold in the US are expected to be produced in India, according to Apple CEO Tim Cook.
- This shift in iPhone production is a response to growing geopolitical tensions and trade tariffs, as Apple diversifies its global supply chain away from China.
- Apple's deepening investment in India's electronics manufacturing sector is a reflection of the sector's boom under the government's production-linked incentive (PLI) scheme, making India a key player in the company's general-news technology strategy.
