Apple’s manufacturing push in India to curb tax leakage, create jobs: Report

US tech giant Apple’s decision to manufacture its entire iPhone 17 range in India will enhance supply chain efficiency, reduce tax leakage, and make a stronger case for India as a premium device manufacturing hub, experts said on Wednesday.

The ‘Make in India’ initiative, bolstered by Apple’s expanded footprint, is expected to generate substantial employment, boost exports, and enhance India’s credibility as a high-tech manufacturing powerhouse, according to Grant Thornton Bharat.

By shifting production to Tamil Nadu and Karnataka through partners Foxconn and Tata Electronics, Apple avoids the 20 per cent Basic Customs Duty otherwise levied on imported, fully assembled devices.

Local assembly also insulates the company from potential tariff escalations in the US, said Krishan Arora, Partner – Tax Planning & Optimisation, Grant Thornton Bharat.

After the US imposed higher tariffs on India, some of the country’s exports now face duties as high as 50 per cent, though smartphones remain exempt for now.

The move by Apple also unlocked further gains under India’s Production Linked Incentive (PLI) scheme, which offers 4–6 per cent cash incentives on incremental phone sales manufactured in India over five years, Arora said, adding that the company’s decision may not immediately lower prices for consumers in India.

This has helped Apple’s contract manufacturers surpass $10 billion in iPhone exports in FY 2024–25, with exports surging 53 per cent year-on-year in H1 2025 to reach 23.9 million units, he added.

In the first half of 2025, as much as 78 per cent of iPhones assembled in India were shipped to the US, up from 53 per cent a year earlier.

The Tamil Nadu government has extended capital subsidies, fast-tracked environmental clearances, and dedicated electronics parks, while Karnataka has offered land at concessional rates, power tariff rebates, and skill development grants.