Apple, which has been largely dependent on China in its supply chain, has announced that it will manufacture the iPhone 14 in India.
“The new iPhone 14 series brings breakthrough new technologies and key security features to our lives,” Apple said in a statement. “We are excited to manufacture the iPhone 14 in India.” statements are included.
Taiwan-based Foxconn, one of Apple’s main suppliers, has been operating in the southern Indian state of Tamil Nadu since 2017, where it manufactures older versions of the iPhone.
However, for the first time, Apple has taken such an ambitious step and is producing a new series iPhone in India.
Apple made the decision to shift iPhone production from China to India at a time of increased tension in relations between Washington and Beijing.
China’s “zero Covid” policy has resulted in widespread quarantines in the country. This has caused businesses manufacturing in China to experience major disruptions during the pandemic.
But that’s not the only reason Apple has turned its course to India. The company is also looking for ways to increase its market share here. As of last year, its share in the smartphone market in India was around 4%.
The American company is struggling to compete with the much cheaper South Korean and Chinese brand that dominates the Indian smartphone market.
However, the fact that the company makes its production in India does not mean that iPhones will be cheaper here. Other taxes, including high duties on imports of smartphone parts in India, are driving up costs.
So even if Indians see the “Made in India” label on their iPhones, they will have to pay a hefty sum to own these phones.
The acceleration of iPhone production in India is an advantage for Prime Minister Narendra Modi’s administration.
The Modi government launched the “Produce in India” campaign eight years ago to increase the country’s production and exports.
Rising tensions between China and the United States (US) over Taiwan and trade mean new risks for the company’s supply chain. The company is also trying to eliminate new disruption risks by adding alternatives to its trade route.
Earlier this month, analysts at investment bank JP Morgan said they expect Apple to move around 5 percent of iPhone production to India this year.
The report estimated that a quarter of all iPhone production will be made in India by 2025.
In addition, the Vietnamese government announced that Apple supplier Foxconn invested $1.5 billion in Vietnam last year.
State media in Vietnam also wrote last month that Apple had signed a $300 million deal to expand its facility in northern Vietnam to increase production there.