Moving Out iPhone Production to Benefit India: GTRI

Indian facilities of iPhones are largely assembly units of components procured from different parts of the globe. For a $1000 worth iPhone in the US, India earns just $30 and much of this is given back to Apple as subsidy under the PLI scheme by the Indian government.

At the same time, New Delhi is cutting tariffs on key smartphone components at the request of big firms like Apple, which hurts domestic firms trying to build a local component ecosystem. “If Apple’s assembly moves out, India will be forced to stop propping up shallow assembly lines and instead invest in deeper manufacturing—chips, displays, batteries, and beyond,” said Ajay Srivastava, founder, GTRI.

It will also cut the US' trade deficit with India, which is a major concern for US President Donald Trump. Though India’s share in every iPhone is less than $30 in the trade data, the full $7 billion export value is increasing the US trade deficit.

Each $1000 iPhone carries the imprint of at least a dozen countries. Apple, through its software, design, and brand, claims the lion’s share of the value—about $450 per device. US component makers such as Qualcomm and Broadcom add another $80. Taiwan earns $150 for chip manufacturing, South Korea adds $90 for OLED screens and memory chips, and Japan contributes $85, mainly via camera systems. Other countries like Germany, Vietnam, and Malaysia account for a modest $45 through smaller parts.

Around 300,000 workers in China and 60,000 in India work in iPhone assembly lines. Moving iPhone assembly from India to the US could instantly create over 60,000 American jobs.

In India, assembly workers make roughly $230 per month. In contrast, US minimum wage laws in states like California will see monthly labour costs for Apple rising to $2,900—a 13-fold increase. The cost of assembling each iPhone would jump from $30 to about $390. Apple’s profit per device would drop from $450 to around $60, unless it decides to hike the prices, finds GTRI.