- Currently, iPhone exports account for approximately 70% of total mobile exports from India.
- Industry experts agree that the groundwork laid in recent years will enable India to capitalise on the increasing demand for mobile devices.
In the current landscape of global trade, the performance of India’s mobile phone exports emerges as a significant indicator of the country’s manufacturing capabilities and economic resilience.
The latest industry data reveals a remarkable achievement: exports of mobile phones from India soared to $6.5 billion during the first quarter of FY25 (April to July period), marking an impressive 40 per cent increase when compared to the same period in the previous fiscal year (FY23).
The upward trajectory is notably driven by the phenomenal success of Apple’s iPhones, reinforcing the notion that India is poised to become a key player in the international electronics market.
iPhone exports: Key contributor
Apple’s strategic initiatives, particularly the production-linked incentive (PLI) scheme introduced by the Indian government, have markedly influenced this growth.
Notably, iPhone exports exceeded $1 billion in July alone, reflecting a consistent performance throughout the fiscal period. Currently, iPhone exports account for approximately 70 per cent of the total mobile exports from India, underscoring Apple’s dominant position in the Indian market.
The substantial contribution is a testament to Apple’s commitment to expanding its manufacturing footprint in India, aligning its interests with the country’s economic growth trajectory.
The success of the iPhone 15, which has emerged as a top seller during this period, can be attributed to significant technological upgrades compared to its predecessors.
The allure of the iPhone brand, coupled with enhancements in features and performance, has propelled its sales, particularly in an increasingly competitive smartphone market.
As online sales continue to improve, Apple’s investment strategy appears increasingly fruitful, reinforcing its belief in the long-term potential of the Indian market.
Economic impact
Apple’s operations in the country reached $23.5 billion in value in the last fiscal (FY24). The Cupertino-based giant clocked nearly $8 billion in revenue in India in the last fiscal.
The impressive financial performance reflects not only the popularity of Apple’s products but also the successful implementation of its local manufacturing strategy.
Key suppliers such as Foxconn, Pegatron, and Tata Electronics (formerly Wistron) have scaled up their assembly operations in anticipation of the busy festive season, demonstrating the urgency and importance placed on maximizing production capabilities to meet rising consumer demand.
Finance Minister Nirmala Sitharaman highlighted the transformative growth of the mobile phone industry in India, noting a three-fold increase in domestic production and an astonishing 100-fold increase in mobile exports over the past six years.
The rapid maturation of the industry indicates not only a shift towards self-sufficiency but also the emergence of India as a robust export hub for mobile devices.
Indeed, the electronics sector, which encompasses various technology goods, has experienced unparalleled growth, reaching a staggering $155 billion in FY23. Mobile phones, in particular, constitute 43 per cent of total electronics production, reflecting their pivotal role in the broader industry.
In FY24, total mobile exports reached $15.58 billion, registering a 40 per cent increase over FY23.
Reducing import reliance
One of the most significant developments in recent years is India’s remarkable stride towards reducing its reliance on smartphone imports.
Government policies have incentivized local manufacturing, leading to the domestic production of an impressive 99 per cent of mobile devices currently available in the market.
The paradigm shift has been instrumental in enhancing the country’s economic sovereignty while bolstering export capabilities.
Apple’s suppliers, including Foxconn, Wistron, and Pegatron, have been active participants in the government’s PLI scheme, which was announced in 2020 with the aim of boosting domestic manufacturing. Foxconn and Pegatron have established operations in Tamil Nadu, contributing to the local economy since commencing their production in 2021 and 2022, respectively.
Meanwhile, Samsung, another significant player, has engaged in the PLI scheme from its outset, with its operations centrally located in Uttar Pradesh. While the scheme has resulted in substantial investment in manufacturing capabilities, it is noteworthy that Pegatron’s participation will be limited to four years due to its later entry.
Despite challenges faced by Wistron during its transition to Tata Electronics, the assembly of iPhones has significantly ramped up, mirroring the broader trend of increasing mobile device production in India.
The current fiscal year marks a crucial point for Samsung, with FY24 being the culmination of its five-year participation in the PLI scheme.