India’s ambition to become a global iPhone manufacturing hub hits a major roadblock as the US imposes 26% reciprocal tariffs, raising costs and risking supply chain disruption.
April 5, 2025: India’s dream of emerging as a global iPhone manufacturing powerhouse is facing serious challenges, thanks to US President Donald Trump’s sweeping “reciprocal tariff” regime. The United States has slapped a 26% tariff on Indian exports, part of a broader trade policy targeting over 180 countries, including heavyweights like China and Vietnam.
While India’s rate is notably lower than China’s 54% and Vietnam’s 46%, industry leaders fear the move could still destabilize electronics exports, dampen investor confidence, and threaten the viability of Apple’s supply chain strategy centered on India.
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“The 26 per cent tariffs imposed by the US present a significant challenge to India’s exports,” said Ashok Chandak, President of the Indian Electronics and Semiconductor Association (IESA), warning that the impact could be profound for domestic industries.
📉 Apple’s India Strategy at Risk
Apple has been shifting around 15% of its global iPhone production to India, positioning the country as a strategic alternative to China amid rising geopolitical tensions. But the latest tariffs could undo that momentum.
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Industry estimates suggest that if Apple passes the increased tariff costs to consumers, the price of the upcoming iPhone 16 Pro Max could rise to as much as ₹1.9 lakh ($2,300). Unsurprisingly, Apple stock plunged over 8% following the announcement — its worst single-day drop since 2020.
Despite this, Apple has not officially commented on the tariff developments.
📈 India’s Export Growth in Jeopardy
India has seen record growth in smartphone exports, largely driven by Apple’s contract manufacturers like Foxconn and Pegatron. Between April 2024 and January 2025, iPhone exports from India touched nearly ₹1 lakh crore, a sharp rise from ₹60,000 crore the previous year.
But now, analysts warn that multinational companies may redirect their next wave of manufacturing investments to countries less exposed to US tariff penalties — risking long-term growth in India’s electronics sector.
“There’s a real chance companies could begin shifting new manufacturing to countries with lower tariff exposure,” a senior industry official told TOI.
🧩 Strategic Response: Trade Talks and Corporate Lobbying
India is reportedly eyeing a bilateral trade agreement (BTA) with the US to shield its industries. Government insiders suggest that corporate support from Apple, Microsoft, and Google may be leveraged to strengthen India’s case in negotiations with the Trump administration.
“Support from corporations such as Apple, Microsoft and Google may be sought… to reinforce India’s pitch during BTA negotiations,” a senior official revealed.
⚠️ Looking Ahead
While India is relatively “less hit” compared to other nations, the long-term implications of the tariffs remain unclear. If unresolved, they could curb India’s ambitious export push and force global tech giants to rethink their commitment to ‘Make in India’.
For now, India finds itself at a critical juncture — needing to balance diplomacy, trade policy, and tech sector interests to maintain its momentum as a manufacturing hub.
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Trump tariffs, Make in India, Apple India, iPhone manufacturing, reciprocal tariffs, US-India trade, electronics exports, iPhone 16 Pro Max, Apple supply chain, India US relations