India Plans Subsidies to Boost Apple's Production Efforts

India is set to implement a series of subsidies and tariff reductions designed to lower production costs for Apple and other smartphone manufacturers as part of its broader effort to become a global electronics manufacturing hub (via Bloomberg).

India is proposing $2.7 billion in financial incentives and tariff adjustments targeting the electronics sector, particularly benefiting smartphone makers such as Apple. The measures are intended to bolster the production of critical components like batteries, camera modules, and microprocessors, which are currently largely imported from countries such as China.

Prime Minister Narendra Modi's government previously rolled out several initiatives, including the Production-Linked Incentive (PLI) scheme, which drew major companies like Apple and Samsung to set up or expand their production facilities in India. The focus of the new proposal is more granular, specifically targeting the establishment of a domestic supply chain for components.

Apple has been steadily increasing its production footprint in India. The company began assembling iPhones in India in 2017, initially focusing on older models. More recently, Apple has ramped up its operations, with India-produced iPhones now accounting for roughly 15% of the company's global output. Notably, the iPhone 16 saw its production in India commence just weeks after its global launch.

The proposed subsidies could further accelerate Apple's plans to localize production, potentially enabling simultaneous launches and production of future models, such as the iPhone 17, in both India and China. A final decision on the measures is expected to be announced during the upcoming federal budget in February.