If Apple CEO Tim Cook decides to shift iPhone manufacturing from India to the US, it would hurt Apple more than India, according to Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI). While India may lose some low-paying assembly jobs, its earnings from iPhone production are minimal—about USD 30 per phone, much of which is returned to Apple via subsidies under the Production Linked Incentive (PLI) scheme. Moreover, India is already reducing tariffs on key smartphone components at Apple’s request, which undermines domestic industries attempting to build a robust local manufacturing ecosystem.
Srivastava argues that India’s role in the iPhone supply chain is limited and low-value, contributing less than 3% of the cost of a USD 1,000 iPhone. Most of the value is captured by companies in the US, Taiwan, South Korea, and Japan through components, design, and software. India and China handle assembly, which while low in value, provides significant employment—around 60,000 workers in India and 300,000 in China. This labor-intensive segment is what former US President Donald Trump aims to bring back to the US—not for technological reasons, but to create jobs.
However, moving assembly to the US would significantly raise production costs for Apple. Indian assembly workers earn an average of USD 290 per month, whereas in the US, the cost would jump to around USD 2,900 monthly due to minimum wage laws. This would increase the assembly cost per device from USD 30 to USD 390, reducing Apple’s profit per iPhone from USD 450 to just USD 60 unless prices are raised, potentially affecting consumer demand. The report questions whether Tim Cook would accept such a steep profit cut to support US manufacturing or prioritize business efficiency. It also raises doubts about Trump’s true motives, suggesting his statements may be a tactic to pressure India during trade negotiations, especially given that China still manufactures 85% of iPhones.
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