Trump’s Push for ‘Made in USA’

During a recent meeting, former U.S. President Donald Trump reportedly asked Apple CEO Tim Cook to bring iPhone production back to the United States. The request echoes Trump’s long-standing “America First” campaign, aimed at restoring domestic manufacturing. But the move comes at a time when global supply chains are already strained, and U.S.-China tensions are pushing tech giants like Apple to diversify manufacturing bases. India, with its growing infrastructure and skilled labor pool, has emerged as a top alternative making Trump's demand a potential threat to Apple’s finely balanced strategy.

Why India Matters for Apple

India is no longer just a sales market for Apple it’s a crucial production hub. As of 2024, nearly 14% of iPhones are assembled in India. Global contract manufacturers like Foxconn, Pegatron, and Wistron have ramped up operations under India’s Production Linked Incentive (PLI) scheme. The country offers numerous advantages

• Labor Cost: Indian factory workers earn around $1.50–$2/hour, far cheaper than $20–$30/hour in the U.S.

• Regulatory Flexibility: India’s manufacturing ecosystem is relatively less burdensome in terms of compliance and labor laws.

• Export Hub: India is increasingly being used as a base for shipping iPhones to Europe and other emerging markets.

• PLI Incentives: Government subsidies, tax benefits, and faster clearances sweeten the deal further.

Price Shock : iPhones Could Get Unaffordable

If Apple were to relocate manufacturing back to the U.S., the cost implications would be severe. Analysts estimate the price of an iPhone in India could surge from ₹82,000 to over ₹2.4 lakh drastically reducing demand. According to Morgan Stanley, this could slash iPhone sales in India by over 60%, a move that Apple can ill-afford in a price-sensitive yet high-potential market.

For Apple, the trade-off is brutal: absorb massive cost escalations and hurt margins, or pass them on and lose market share. Neither option is attractive.

India vs. China: A Geopolitical Hedge

Apple’s pivot to India is not just about cost—it's about de-risking. Rising tensions between the U.S. and China have made it risky to rely on Chinese factories. India, by contrast, offers

• Stronger U.S. Diplomatic Ties: Reducing the risk of sudden geopolitical blowback.

• Dual Market Advantage: A growing domestic base and an export-friendly policy regime.

• Lower Costs Than Vietnam: Making it the sweet spot between efficiency and scale.

If Apple pulls out, the vacuum could be quickly filled by competitors like Samsung and Xiaomi brands that have already rooted themselves in India’s manufacturing landscape.

Apple’s Likely Strategy

Despite political pressure, Apple is unlikely to make a wholesale shift away from India. Instead, industry experts believe

• It may expand Indian capacity to deepen its supply chain presence.

• A small-scale, symbolic manufacturing setup in the U.S. may be created for high-end or custom models to satisfy political optics.

• Apple will continue lobbying quietly for balanced trade policies that support global efficiency without drawing political heat.

Conclusion: India Is Non-Negotiable for Apple

Trump’s call to "bring iPhones home" may resonate with American voters, but for Apple, it’s not a viable business strategy. The sheer economics of labor, scale, and supply chain logistics make India irreplaceable.

India is now more than just a manufacturing stopgap it’s an anchor for Apple’s post-China diversification. Any forced exit would not only erode Apple’s margins but also compromise its competitive edge in fast-growing markets. For Apple, India's role is not optional it's essential.

In a globalized economy, political populism can make headlines. But building and shipping the world’s most iconic smartphone? That still needs a global game plan and India is at the center of it.