According to a credible source, with unprecedented outbound sales of USD 12.8 billion (Rs 1.08 trillion), Apple has crossed the Rs 1 trillion milestone for iPhone exports from India in 2024, marking a 42% year-over-year increase.
According to preliminary estimates for January through December, domestic production increased by nearly 46 percent to USD 17.5 billion (Rs 1.48 trillion) over the previous year, and this growth is ascribed to improved local value addition, which currently varies between 15-20 percent depending on the model, the news report stated. Nine billion iPhones were exported by Apple in 2023, accounting for three-fourths of its USD 12 billion in domestic production.
A government official referred to Apple's export performance as "unprecedented for a single product in a year," emphasizing the significance of the smartphone production-linked incentive (PLI) program. The production and export estimates are based on the freight on board (FOB) value, which excludes a retail markup of approximately 60%. The study stated that incentives under the PLI plan are computed based on the FOB value.
On Track for $30 Billion in Domestic Manufacturing
Apple has consistently boosted its local value addition to 20% for some models by growing its supplier network in India, industry sources reported. At the start of the PLI plan, this value addition was only 5–8%. If this trend continues, Apple might reach $30 billion in yearly manufacturing within a few years, increasing India's portion of the global iPhone production ecosystem to more than 26% from the present 14%, according to the news article.
Apple is also boosting its retail presence in India, the world's second-largest smartphone market, which is turning toward higher-end models. Currently, India is Apple's fifth-largest market, trailing Japan and the United Kingdom in third and fourth place, respectively. Local iPhone sales are likely to increase by 20 percent this year, reaching up to 15 million units, as Apple concentrates on new regions to offset a fall in its market share in China caused by Huawei's return.
Strengthening Local Partnerships
According to preliminary figures, Foxconn (Hon Hai) accounted for 54% of the $12.8 billion in exports, followed by Tata Electronics at 29% and Pegatron at 17%. Tata recently purchased Pegatron. All PLI scheme beneficiaries must disclose production, export, and employment data to the government.
Since the PLI program began in 2021, Apple's ecosystem has routinely outperformed expectations for production, exports, and employment growth. The company has emerged as India's largest and fastest-growing private-sector employer, creating over 185,000 direct positions, more than 70% of which are held by women, many of whom are first-time employees, according to the report.
Foxconn's iPhone plant in Tamil Nadu is India's largest factory by employment across all industries, with over 30,000 women among its 42,000 employees during peak hours.
Focus on Local Value Advancement
Apple is prioritising value creation in India by onboarding Indian and mostly non-Chinese suppliers. The company has begun producing components and subassemblies domestically. Many of its vendors are likely to participate in the next electronics components incentive program, according to government and industry sources mentioned in the paper.
While the PLI system has significantly increased final assembly of electronics, local manufacture of components such as printed circuit boards (PCBs), camera modules, display sub-assemblies, lithium-ion cells, speakers, vibrator motors, and other mechanics has slowed. These components, which make up over 50 percent of the cost of a mobile phone or laptop, are expected to be included in the next incentive plan.
