India’s iPhone production has reached a major milestone, achieving a freight-on-board (FOB) value of US$ 10 billion (Rs. 84,720 crore) in the first seven months of FY25 (April-October 2024). This impressive growth is driven by three key players: Taiwanese companies Foxconn and Pegatron, and India’s own Tata Electronics. Tata Electronics, which has been primarily involved in iPhone manufacturing, is also positioning itself for a broader role in the global electronics market. The company is looking to diversify its partnerships by collaborating with major international firms such as Microsoft, Dell, and HP, with the aim of emulating the success of Taiwan’s Foxconn and becoming a dominant force in global electronics manufacturing.

This remarkable progress aligns perfectly with India’s Make in India initiative, which seeks to boost local manufacturing by increasing the value addition in the electronics sector. The Indian government is expected to unveil a US$ 4.72 billion (Rs. 40,000 crore) package to promote the production of electronic components, further strengthening the country’s manufacturing capabilities. This package aims to reduce India’s reliance on imports and increase local value addition to 35-40% over the next five years. The long-term goal is to raise this figure to 50%, aligning with India’s ambition to become a global manufacturing hub.

India's demand for electronic components is forecasted to grow significantly, from US$ 45.5 billion (Rs. 3,85,476 crore) in FY23 to US$ 240 billion (Rs. 20,33,280 crore) by FY30. As the demand for electronics components grows, the government’s initiative is crucial for integrating domestic companies into global supply chains and reducing India’s dependence on imported components. This shift is seen as vital for strengthening India’s position in the global electronics manufacturing landscape.

While the Production-Linked Incentive (PLI) schemes have seen success in the smartphone sector, India still faces challenges in securing a larger share of the global electronics supply chain. Structural and policy-related issues need to be addressed for India to stay competitive against other manufacturing hubs such as Vietnam and Thailand. These challenges include improving infrastructure, resolving regulatory hurdles, and increasing ease of doing business, which are critical to attracting more global companies to set up production in India.

The progress made in iPhone manufacturing is a clear indication of India’s potential to become a key player in the global electronics sector, but sustained efforts from both the government and the private sector will be necessary to ensure that the country can fully leverage its manufacturing capabilities. The growing presence of companies like Tata Electronics, alongside global giants like Foxconn and Pegatron, provides a solid foundation for India to expand its role in the global electronics supply chain.

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