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iPhone Production In India To Reach 25% Of Global Shipments By 2025: Report
India’s manufacturing landscape is undergoing a significant transformation, with the country emerging as a global hub for iPhone production. Recent reports from Jefferies, a global investment firm, highlight that iPhone production in India has seen a remarkable surge from less than 1% in 2017 to 10% in 2023. The growth is attributed to the ‘Make in India’ initiative and the Production-Linked Incentive (PLI) scheme, which have collectively facilitated this shift. The ambitious plan now is to escalate this to 25% of global shipments by 2025.
The Role of PLI Scheme and Global Supply Chain Diversification
The introduction of the mobile PLI scheme, alongside efforts towards global supply chain diversification, has been pivotal in enhancing Apple’s local manufacturing capabilities in India. This strategic move not only bolsters India’s position in the global electronics market but also aligns with Apple’s strategy to diversify its production bases beyond China.
Apple’s Latest Models and Production Targets in India
Apple unveiled its latest offerings, the iPhone 16 Pro and Pro Max models, which are set to be manufactured in India immediately following their global launch. This quick turnaround time underscores the growing significance of India in Apple’s global production network. The tech giant has set an ambitious target to manufacture over 50 million iPhones annually in India, indicating a substantial shift in its production strategy.
Electronics Export Trend and Potential for Growth
The surge in iPhone exports from India, reaching $12.1 billion in the fiscal year 2023-24 from $6.27 billion in 2022-23, is a testament to the success of local manufacturing initiatives. Despite the remarkable growth, Jefferies notes that there is still ample room for improvement in terms of value addition in electronics exports from India. Moreover, with electronics imports still being more than double the exports, there is a significant potential for in-sourcing and further growth in the sector.
Government Initiatives to Boost Manufacturing
To foster manufacturing across various sectors, the Indian government has introduced PLI schemes across 14 sectors, with a total value of Rs 2 lakh crore. Additionally, there is a commitment of Rs 70,000 crore to enhance the semiconductor and display manufacturing ecosystem. These initiatives are designed to attract investments, boost local production, and position India as a global manufacturing hub.
Market Outlook and Consumer Trends
Industry experts and market insights from CyberMedia Research (CMR) suggest that Apple’s growth momentum in India is set to continue, driven by increased ‘Make in India’ manufacturing and aggressive marketing strategies. The aspirational appeal of Apple products, coupled with a growing preference among consumers for the latest generation of iPhones, is expected to drive a 30% growth in sales of the new iPhones compared to the previous iPhone 15 generation in the launch quarter.
As India strengthens its position in the global electronics manufacturing landscape, the country is poised to play a crucial role in Apple’s global production strategy. With favorable government policies, significant investments, and a growing consumer market, the future of iPhone production in India looks promising, with the potential to reach 25% of global shipments by 2025.
