Apple is worth trillions of dollars. It dominates the global smartphone, PC, and earphone market. It also has leading graphical, audio, and video editing software. Until 2020, Apple did about 2-3% of its manufacturing in India.

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India had already been a point of interest for its massive domestic market for over a decade. Most of the manufacturing, about 95%, was done in China. Things stayed that way for quite some time until quite recently.

Apple Wanted to Diversify Its Supply Chain

A couple of factors led to this boiling point. China was one of the worst-hit places during the pandemic. Foxconn, a major manufacturer for Apple in China, faced a flurry of difficulties during this time.

Their factories were deserted amid covid outbreaks, and movement was restricted. To top it off, the workers arranged mass protests against the company over wage issues. All this turbulence brought production to a halt. By 2022, China’s challenges had caused major disruption in the company’s entire supply chain.

iPhone 14 Pro and Pro Max stocks were critically low at the peak of the holiday season. Both Apple and Foxconn looked to India to find a solution to their problems.

Why India?

The country recently overtook China in terms of population. There is ample labor for production and a vast domestic market. Infrastructure was traditionally a problem, but there is a wave of undergoing national projects to address those issues.

Apple said India is a “huge and exciting market” for them. The country consistently sets newer sales records year after year for its products. They hope to do 25% of their iPhone production here by 2025 and increase it to 50% by 2027.

Is the country equipped to reach these goals?

India is ambitious and driven to make use of this opportunity. 2-5% of global production was already happening in Tamil Nadu and Karnataka. Besides that, Samsung actually has one of the world’s biggest mobile factories in Noida. I’m mentioning this to give a full picture of the industry.

iPhone production requires locally-made components. Thus, many other companies along iPhone’s supply chain must also expand into the country. Tata has risen to take over the components part and is acquiring a factory in Karnataka.

What is the current situation?

Apple opened its first store in Mumbai on April 18 and another in Delhi on April 20. The company’s manufacturing units in the country were the first to start production just a few weeks after launch. This shows how serious Apple is about expanding into Asia’s third-biggest economy.

Apple is easily one of the biggest companies in the world. This development will surely make massive waves in the tech industry and the country’s economy. Besides the jobs created by the factories, there will be GDP growth and more opportunities down the line.

Currently, Apple is making a few selected products here until quality issues are taken care of.