Apple has approved setting up its iPhone manufacturing unit in India. Apple has taken this big decision at a time when America is threatening to increase tariff rates. This move by Apple indicates that Apple, along with other companies, is finding it more profitable to set up its manufacturing plant in India. This will also directly benefit India.
Now iPhones Will Be Made In India
Apple is now turning to India to reduce its dependence on China. Apple has finally decided to set up an iPhone manufacturing plant in India. India will manufacture 25% of the world’s iPhones by the end of 2025. Which was almost 0% till a few years ago. Apart from this, recently Foxconn invested about Rs 12,700 crore in Tamil Nadu. And big companies like Pegatron and Wistron are also going to set up their manufacturing plants in India.
Trump’s Tariff Threat Proved Ineffective
Donald Trump had threatened that if Apple did not increase the production of iPhones in America, then a 25% tariff would be imposed. Despite this, Apple has continued to invest in India. It is clear from this that global companies have now started considering India as a reliable manufacturing destination of the future.
It Will Make A Big Contribution To India’s GDP
The rapid growth in electronics manufacturing will also have a direct impact on India’s economy. The Indian government aims to reach $300 billion in electronics manufacturing by 2027. Out of which $120 billion should be exported. This will provide employment to millions of people and will significantly increase the country’s GDP. The arrival of foreign companies in India will also curb unemployment.
Assembly Cost Will Increase 13 Times In America
Although this will be entry level manufacturing, its cost will be very high. In India, the employees doing assembly get an average of 230 dollars per month. In contrast, in states like California in America, the minimum wage is 2900 dollars. This is 13 times more than in India. In this way, the cost of assembling an iPhone will increase from 30 dollars to 390 dollars. If Apple does not increase the price of the phone, then its margin per device will decrease from 450 dollars to 60 dollars.
India Will Also Benefit Know How
Srivastava said, “If Apple takes the manufacturing of iPhone to America, then not only American citizens will get jobs, but the US economy will also benefit. But contrary to popular belief, India will also benefit from this. India earns $30 per iPhone. A large part of this goes to Apple as subsidy under the PLI scheme. Reducing import duty on smartphone components is hindering the development of component ecosystem domestically. If Apple’s assembly moves out of India, then India will also invest in deep manufacturing like chips, displays, batteries.”
