Apple's iPhone exports from India doubled to $12.1 bn in FY24
The US stands out as the largest importer of smartphones from India, importing around $6 billion worth in the fiscal year 2023-24
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New Delhi: Apple's iPhone exports from India almost doubled to $12.1 billion in the fiscal year 2023-24, up from $6.27 billion in the preceding year, according to trade intelligence platform The Trade Vision. The total smartphone exports from India saw an increase, reaching $16.5 billion in 2023-24, compared to $12 billion in the preceding year.
Trade Vision highlighted the impact of Apple's presence on the industry, stating that it has driven growth and innovation in the Indian manufacturing ecosystem. The exponential growth in iPhone exports from India, from $6.27 billion in 2022-23 to $12.1 billion in 2023-24, reflects India's significant role in Apple's global supply chain.
The trade intelligence platform noted that Apple's decision to expand manufacturing operations in India is driven by factors such as diversifying its supply chain, mitigating geopolitical risks, and tapping into India's growing consumer market. Initiatives like the Production-Linked Incentive (PLI) scheme by the Indian government have further encouraged companies like Apple to invest in local manufacturing.
The trade intelligence platform also highlighted the increasing presence of India-made iPhones in the US market. US stands out as the largest importer of smartphones from India, importing around $6 billion worth in the fiscal year 2023-24. Apple iPhones accounted for a significant portion of this, totaling $5.46 billion, a notable increase from $2.1 billion in the previous fiscal year. This trend indicates a growing preference for Indian-made iPhones among American consumers.
According to official reports, Apple is on track to produce iPhones worth Rs. 1 lakh crore (US$ 12 billion) in India by the end of March 2024. The tech giant has already ramped up its production capacity to exceed Rs. 60,000 crore (US$ 7.19 billion) in the first seven months of the fiscal year. Officials suggest that if Apple falls short of the Rs. 1 lakh crore milestone this fiscal year, it is likely to achieve it in the first quarter of FY25.
Fulfilling demand amid global challenges
As Apple prepares to meet demand for its products during the upcoming festive season in the US and the West, it faces challenges amid declining consumer gadget consumption globally.
Approximately 70% of iPhones manufactured in India are exported, with Apple exporting iPhones worth Rs. 40,000 crore (US$ 5 billion) from April to October of the current fiscal year.
Record exports and manufacturing operations
In FY23, iPhones became the first single brand to export over US$5 billion from India. Apple's exports have soared by 185% year-over-year in the first seven months of this fiscal year, compared to Rs 14,000 crore ($1.67 billion) worth of iPhones exported during the same period last year.
Under the production-linked incentive (PLI) scheme for smartphone manufacturing, Foxconn and Pegatron in Tamil Nadu and Wistron (now under the Tata Group) in Karnataka, handle Apple's manufacturing operations in India.
Tata Group's entry into Apple's supply chain
In a significant development, Wistron Hong Kong and the Tata Group recently finalized an agreement for Tata Group to acquire a 100% equity stake in Wistron Infocomm Manufacturing (India). This move makes Tata Group the first company in India to enter Apple's iPhone manufacturing supply chain formally. As part of the US$ 750 million agreement, a $550 million inter-corporate loan from the parent company to Wistron India was included.
Apple's strategic focus on India
Since 2018-19, Apple has been increasingly concentrating on iPhone manufacturing in India. The company conducted market tests for a couple of years by producing limited quantities of iPhone SE, 7, and 8 models. Apple thoroughly examined the Indian manufacturing landscape, including factors like the availability of skilled labour, from 2018 to 2020.
Growing domestic market and expansion plans
In addition to exports, Apple is benefiting from the rising premiumization trend in the domestic market. It is anticipated to sell a record 9-10 million iPhones in India in 2024, compared to fewer than 7 million in 2023. Furthermore, Apple plans to commence AirPods production at the Foxconn facility in Hyderabad starting December 2024, expanding its manufacturing footprint in India.
