Even if the United States imposes a 25% tariff on iPhones manufactured in India, producing the devices there would still be significantly more cost-effective than making them in the US, according to a report by the Global Trade Research Initiative (GTRI).
This follows recent remarks by former U.S. President Donald Trump, who threatened to levy heavy tariffs on iPhones if Apple continues to manufacture them outside the US, particularly in India. Despite this, the GTRI report shows that India remains a highly economical manufacturing base for Apple, even with such duties.
The report provides a detailed breakdown of the value chain behind a $1,000 (approx. ₹83,400) iPhone. Apple takes the lion’s share—around $450 (approx. ₹37,530)—from branding, software, and design. Meanwhile, U.S.-based component suppliers like Qualcomm and Broadcom contribute about $80 (approx. ₹6,672) per device.
Other major contributors include:
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Taiwan – $150 (approx. ₹12,510) for chip manufacturing
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South Korea – $90 (approx. ₹7,506) through OLED screens and memory chips
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Japan – $85 (approx. ₹7,089), mainly for camera systems
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Germany, Vietnam, Malaysia – Combined $45 (approx. ₹3,753) for smaller parts
In contrast, China and India, both key locations for final assembly, each earn only around $30 (approx. ₹2,502) per iPhone—less than 3% of the retail price.
One of the biggest cost advantages comes from labour. Indian assembly workers earn around $230 (approx. ₹19,182) per month, while their counterparts in U.S. states like California can earn as much as $2,900 (approx. ₹2,41,860) per month—a 13-fold difference.
Due to this wage gap, assembling an iPhone in India costs about $30 (approx. ₹2,502), while the same process in the US would cost approximately $390 (approx. ₹32,526). On top of that, Apple benefits from India’s Production-Linked Incentive (PLI) scheme, which provides additional cost savings.
If Apple were to move iPhone production to the US, its per-device profit could drop sharply from $450 to just $60 (approx. ₹5,004)—unless it raises retail prices significantly.
The GTRI report concludes that global value chains and labour cost disparities strongly favor India as a manufacturing hub for Apple, even in the face of proposed U.S. trade restrictions.
