Apple gets tax break in India, a boost to iPhone production

Apple is benefiting from a new tax break in India, which will make it cheaper to assemble iPhones in the country. The change was announced by the government on Saturday.

We first learned about the plans last month, which are expected to be worth at least $2.7B in benefits to companies like Apple and Samsung …

India is Apple’s second-largest production hub

After China, India is Apple’s second-largest center for iPhone assembly. We’ve been hearing ambitious reports for some time now – that half of all iPhones could be made in India by 2027 – though actual progress has been slower.

Things stepped up significantly last year. Bloomberg reported back in April that around one in seven iPhones were made in India, but the production of flagship models had always lagged significantly behind due to the advanced manufacturing processes needed. That changed with the iPhone 16, with production in India starting within weeks of launch.

Apple gets tax break

The government has been gradually reducing import duties on electronic components imported into the country for local manufacture, and has now announced an extension to this,

Reuters reports that a tax on printed circuit boards was among the iPhone parts to be zero-rated.

India has removed import duties on some components key to producing mobile phones, Finance Minister Nirmala Sitharaman announced in the annual budget on Saturday […]

The list included components for mobile phone assembly such as printed circuit board assembly, parts of camera modules, and USB cables, which were taxed at 2.5% earlier.

The move will make iPhone production in India cheaper, with the government gambling that it will encourage Apple to move more of its manufacturing there.

Photo by Kirti Kalla on Unsplash