India's smartphone exports have witnessed a major spike in recent years, with iPhone shipments from the country alone crossing $10 billion in value for the first time in 2023-24. Powered by production-linked incentive schemes unveiled by the government, Apple has significantly ramped up iPhone assembly in India through contract manufacturers like Foxconn and Wistron.
iPhone exports accounted for around 65% of India's total smartphone exports last fiscal year valued at $15 billion, up from just $5 billion in the previous year. This dramatic growth can be attributed to efforts by the Modi government to transform India into a global electronics manufacturing hub. Large scale iPhone production was pioneered by Foxconn at its Tamil Nadu plant hosting over 40,000 workers.
Encouraged by the success, Apple is now targeting more than 50 million iPhones to be made annually in India within 2-3 years, compared to just 1 in 7 iPhones globally as of last year. This will make the country one of Apple's most critical manufacturing bases outside of China. To achieve this, both Apple and its suppliers are further expanding existing facilities and hiring more local workforces, which are expected to employ around 5 lakh individuals in the ecosystem over the next 3 years.
In a bid to sustain this momentum, the government is actively courting global component suppliers to set up base in India through production-linked incentives. Major players making camera modules, communications chips and other core parts have evinced interest. If realized, this will help strengthen domestic linkages for iPhone production and ultimately reduce dependency on imports. However, high import tariffs continue to be a hindrance for bolstering the local supply chain. With continued policy support, India is well on track to emerge as Apple's most strategic manufacturing destination outside of China.
