Apple Inc. said exports of iPhones made in India have jumped by a third in the six months to September as the US tech giant continues to increase its manufacturing capacity in the country to lessen its dependence on China.
According to sources who know the details, Apple exported nearly $6 billion worth of iPhones manufactured in India during this period, which is a substantial year-on-year increase. This would set the trend for annual exports to exceed $10 billion in fiscal 2024.
But the tech giant is rapidly expanding its manufacturing presence there, leveraging India’s generous subsidies and well-trained manpower as the country catapults a technological makeover. With Beijing-Washington tensions rising, India has become a key cog in Apple’s plans to diversify from the risks associated with its China operations.
Three key suppliers are leading the assembly of iPhones in southern India: Taiwan’s Foxconn Technology Group, Pegatron Corp., and India’s Tata Electronics. With operations near Chennai, Foxconn’s local unit is the biggest supplier in the region, accounting for half of India’s exported iPhones.
The Tata Group’s electronics manufacturing arm also reported a record performance, exporting around $1.7 billion in iPhones from its factory in Karnataka between April and September. The facility was acquired by Tata from Wistron Corp. last year in a milestone deal that made the group the first Indian assembler of Apple’s flagship product.
The figures quoted are all estimates of what the devices will be worth at factory gate value rather than retail prices. Apple, Pegatron, and Foxconn all declined to comment.
According to federal trade ministry data, iPhones account for the lion’s share of India’s smartphone shipments. The category also topped the country’s export list to the U.S. at $2.88 billion in the first five months of the fiscal year. Five years ago, before Apple significantly expanded its production in India, the country exported only $5.2 million worth of smartphones annually to the U.S.
That said, Apple has less than 7% of the Indian smartphone market, where Chinese brands like Xiaomi, Oppo, and Vivo dominate. However, Apple is investing intensively in the Indian market.
Prime Minister Narendra Modi’s government has provided subsidies that have enabled the assembly of premium iPhone 16 Pro and Pro Max models in India this year. The company plans to open new retail stores in Bangalore and Pune after the successful launches of its maiden shops in Mumbai and New Delhi last year.
Buoyed by its aggressive marketing strategy and an increasingly voracious middle class hungry for Apple products, these new openings sent Apple’s revenue in India surging to a record $8 billion for the year ending March. Analysts at Bloomberg Intelligence forecast revenues could roar to about $33 billion in 2030 as middle-class affluence spreads and payment plans proliferate.
Apple’s bright prospects in India sharply contrast with its situation in China, where economic growth slowed under severe lockdowns against COVID-19 and a property crisis. That has not kept Apple from remaining dependent on China for much of its manufacturing and sales, and India will not be taking over from China for some time.
Apple Inc. is likely to assemble iPhones worth $14 billion in India during the fiscal ending in March 2024, doubling its production and furthering the company’s strategy of diversifying from China. Of the total, about $10 billion is estimated to be exported.
