Facing mounting challenges from former President Donald Trump’s tariff war with China, Apple is accelerating its strategy to shift a significant portion of its iPhone production to India. By the end of 2026, the tech giant aims to assemble the majority of iPhones sold in the US in India — a move that could double its current output from the South Asian country and reduce its dependence on Chinese manufacturing.
Currently, nearly 80% of the 60 million iPhones sold annually in the US are produced in China. Moving production to India is seen as a critical step for Apple to offset the growing costs linked to heightened tariffs on Chinese goods.
The Financial Times was the first to break the story on Friday.
Reports from Reuters suggest that Apple, valued at over $3 trillion, is actively in talks with key partners in India such as Foxconn and the Tata Group to bring this ambitious plan to life.
Apple has been steadily expanding its manufacturing presence in India, a trend that began in response to the tariffs imposed during Trump’s initial term. In March alone, Apple shipped $2 billion worth of iPhones from India to the US — a record-breaking figure for both Foxconn and Tata Group, according to Reuters.
Indian Prime Minister Narendra Modi has been working aggressively to promote India as a global hub for smartphone manufacturing. This year, India further incentivized companies like Apple by scrapping import duties on select mobile phone components.
According to Babak Hafezi, CEO of Hafezi Capital, “By removing taxes on intermediary goods, India aims to become highly competitive in global manufacturing markets.”
Bloomberg reports that Apple assembled approximately $22 billion worth of iPhones in India during the 12 months ending March 2025 — a 60% surge compared to the previous year. Yet, even with this growth, India only accounts for about 20% of global iPhone production.
🚧 Challenges Ahead:
However, Apple’s transition won’t be without hurdles. Manufacturing in India is reportedly 5-8% costlier than in China, as per Reuters sources.
Dan Ives, an analyst at Wedbush Securities, commented to Al Jazeera, “India will help diversify Apple’s supply chain, but it won’t quickly eliminate their reliance on China. Shifting a significant chunk of production will take years.”
In addition, recent reports from The Information reveal that Chinese authorities have been creating obstacles for Apple suppliers attempting to relocate operations to India, including delaying or denying shipment approvals.
Ives further estimated that Apple’s efforts to fully shift US iPhone assembly to India could cost between $30 billion to $40 billion.
Infrastructure concerns in India could also slow down production. According to Hafezi, “Traffic congestion, mobility issues, and inconsistent infrastructure could increase operational costs.”
“To truly compete globally, India needs a secure, efficient, and continuous infrastructure,” he emphasized.
🌐 The Broader Trade Picture:
Interestingly, this strategic move by Apple coincides with signals from the Trump administration indicating a possible softening of the US-China trade dispute. Trump recently claimed to have spoken with Chinese President Xi Jinping, although details remain unclear. TIME Magazine reported that Trump’s team has been in preliminary discussions with Beijing over potential tariff agreements — though China has officially denied any active negotiations.
Meanwhile, US-India trade relations seem to be warming. US Vice President JD Vance met with PM Modi earlier this week and announced “good progress” toward a bilateral trade agreement.
Apple’s decision to deepen its commitment to Indian manufacturing comes just ahead of its upcoming earnings report, scheduled for release on Thursday.