In a game-changing move amid the ongoing US-China trade war, Apple is set to shift the entire production of iPhones destined for the US market to India by 2026. This strategic pivot aims to sidestep the crippling tariffs imposed on Chinese imports, which have soared as high as 145%, and reduce Apple’s heavy reliance on China’s manufacturing ecosystem.
The shift isn’t sudden – It’s the culmination of a gradual transition that began in 2017, when Apple partnered with Taiwanese contract manufacturer Wistron to start assembling iPhone 6s and iPhone SE models in Bengaluru. Since then, India’s share of global iPhone production has climbed steadily, reaching around 14% in 2024, with analysts projecting it could hit 25% by the end of this year. Why India? The answer is simple: cost-effectiveness and geopolitical necessity. The Trump administration’s aggressive tariff policies on Chinese goods, including a 20% tariff even before his second term and a staggering 145% tariff later, made manufacturing in China increasingly expensive for Apple. Despite CEO Tim Cook’s efforts to negotiate tariff exemptions, relief never materialized, forcing Apple to look for alternatives.
India’s manufacturing ecosystem, although still developing, offers Apple a viable and growing base. The Bengaluru factory, initially focused on older models, is now gearing up to produce the latest iPhones for the US market. Apple plans to double its production capacity in India, targeting over 60 million iPhones annually by 2026 to meet America’s massive demand.
However, the road isn’t without bumps. India imposes a 26% tariff on US imports, though this was temporarily suspended for 90 days amid ongoing negotiations between Washington and New Delhi. This tariff dance adds complexity but hasn’t deterred Apple’s commitment.
With US Vice President JD Vance visiting India amid these developments, the geopolitical and economic stakes have never been higher. Apple’s bold bet on India not only promises to reshape global supply chains but also signals India’s rising clout as a manufacturing powerhouse.
For India, this is a golden opportunity to cement its place on the global tech map. For Apple, it’s a necessary gamble to protect margins and maintain dominance in the world’s most lucrative smartphone market. The countdown to 2026 has begun-and the world will be watching how this India pivot changes the game.