Apple India supply chain expansion: Days after US President Donald Trump said he had asked Apple’s CEO Tim Cook to “not produce in India,” the iPhone maker’s key contract manufacturer, Foxconn, said it is moving forward with a $1.5 billion display module plant in India.
In an exchange filing at the London Stock Exchange earlier this week, Foxconn said it was investing $1.49 billion in one of its India units, Yuzhan Technologies (India) Pvt Ltd. The plant is expected to come up in Tamil Nadu, where Foxconn also has a major iPhone production base.
“Supply chains don’t reorient themselves overnight. Companies that are as big as Apple make supply chain decisions after months and years of strategising. One stray comment which discourages them from their move is not going to change the fact that they want to double down on production in India,” a senior government official said.
Last October, the Tamil Nadu government had cleared the Rs 13,180 crore project by Yuzhan Technology in Kancheepuram, about 80 kilometres away from Chennai. It is expected that Foxconn’s fresh investment in the country, as it intimated to the stock exchange, would go into this plant.
Apple has identified India as a key market for iPhone production and a gradual base for its suppliers in a move away from China. The company currently produces nearly 15% of all iPhones in India, with plans to increase that to a quarter in the coming years. The company’s assembly operation in India has been a key success story of the government’s ‘Make in India’ push.
Apple did not respond to an immediate request for comment.
What Trump had said
This comes despite Trump asking Apple’s Cook to halt production in India and instead shift base to the United States.
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“I had a little problem with Tim Cook yesterday. I said, ‘Tim you’re my friend, I’ve treated you very good, you’re coming here (in the US) with a $500 billion announcement, and now I hear you’re building all over India. I don’t want you building in India. You can build in India if you want to take care of India, because India is one of the highest tariff nations in the world’… ‘we put up with all the plants you built in China for years. We are not interested in you building in India. India can take care of themselves’,” Trump said after a meeting between business leaders from the US and Qatar last week.
However, soon after his comments, Apple representatives in India had told government officials that there was no change in their investment plans and gradual expansion in the country. Union IT Minister Ashwini Vaishnaw had earlier said that mobile phone exports from India have crossed an all-time high of Rs 2 lakh crore in FY25, in which iPhone exports alone accounted for Rs 1.5 lakh crore.
In the crosshair of a global trade war
Cook had earlier also confirmed that owing to US and China-related trade uncertainties, the company will produce a majority of iPhones sold in the US in India in the June quarter. However, since then the two countries have announced a trade deal which could have an impact on the company’s plans.
It was widely anticipated that because of significantly higher tariff rates on China, companies like Apple would fastrack their diversification to India, where Apple has developed a sizable assembly base. Although, any potential thaw in US-China relationships could pose a challenge to the expected migration of supply chains to India.
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Apple: the key beneficiary of Indian subsidies
Apple and its manufacturing partners have been the biggest beneficiaries of subsidies under the PLI scheme for smartphones. The Indian Express had earlier reported that, under the scheme, the government has disbursed close to $1 billion in the three years from 2022-23 to 2024-25, with the three contract manufacturers of Apple receiving cumulatively over 75 per cent of the amount.
Apple’s contract manufacturers, Foxconn, Tata Electronics and Pegatron (which was recently acquired by the Tatas), have received a total of almost Rs 6,600 crore over three years — 2022-23 and 2024-25.
In 2023-24, Foxconn, which is Apple’s biggest contract manufacturer globally, received a subsidy disbursal of Rs 2,450 crore, the highest during the year. However, in 2024-25, the data showed no incentive was issued to Foxconn. In 2024-25, Samsung received the highest subsidy of close to Rs 958 crore.
In March, the Indian government had also cleared a Rs 23,000 crore incentive policy for electronics components manufacturing. It is expected that it could be a big draw for Apple’s suppliers.