- USA suspends additional 26% tariff on India- 10% Remains
- iPhone 17 already in production in India
- India claims $22Bn worth already built, exporting $17Bn iPhones
- Plans fully transition by 2026
- Plans produce 60 Mn iPhones annually
- Apple prior shipped iPhones from China to India to USA to Avoid Tariffs
U.S. Suspends Additional 26% Tariff on India, Apple Ramps Up iPhone Production
The U.S. has suspended an additional 26% tariff on India for 90 days, leaving a 10% tariff in place, as trade talks heat up. Meanwhile, Apple is accelerating its shift of iPhone production from China to India, with the iPhone 17 already in trial production and plans to produce 60 million iPhones annually by 2026. India’s rise as a tech manufacturing hub—exporting $17 billion in iPhones—is reshaping global supply chains. Here’s how tariffs, trade deals, and Apple’s ambitions are converging.
U.S.-India Trade: Tariff Suspension and Talks
On April 2, 2025, President Trump imposed universal duties on about 60 countries, including steep levies on India, to cut the U.S. trade deficit and boost domestic manufacturing. India faced an additional 26% tariff, but a White House executive order has now suspended it for 90 days until July 9, 2025, leaving a 10% tariff in effect.
India’s pushing for a zero-for-zero tariff deal on specific items like steel, auto parts, and pharmaceuticals, based on reciprocity and capped import volumes, per sources cited in a Bloomberg report. Both nations aim to lock in a deal before the 90-day expiration. The U.S. has raised concerns about India’s Quality Control Orders (QCOs), mandatory standards for manufacturers, viewing them as trade obstacles lacking transparency and fairness. QCOs have surged from 14 before 2014 to over 140 since 2017.
India’s open to reviewing QCOs, especially in medical devices and chemicals, and has proposed a mutual recognition agreement to align regulatory frameworks. Whether these ideas make the final deal remains uncertain. Notably, services—a strength for Indian giants like TCS and Infosys—aren’t targeted by U.S. tariffs, which cover 56.1% of India’s goods exports. These firms may only face indirect risks if a global economic slowdown hits their overseas clients.
Apple’s Big Bet on India
Apple is seizing the moment, shifting U.S.-bound iPhone manufacturing from China to India to dodge U.S.-China trade tensions and tariffs. Key moves include:
- iPhone 17 trial production is underway in India, a first for the series.
- Apple aims to fully transition U.S.-focused assembly by 2026, targeting 60 million iPhones annually to meet U.S. demand alone.
- In 2025, India assembled iPhones worth $22 billion, exporting $17 billion, per India’s Minister for Electronics and IT, Ashwini Vaishnaw.
Apple’s seriousness was clear when it chartered flights to ship 1.5 million iPhones from India to the U.S., both to avoid tariff costs and test India’s ability to handle demand spikes. Previously, Apple shipped iPhones from China to India to the U.S. to skirt tariffs, but India’s now the hub.
Foxconn, Pegatron, and Wistron (acquired by Tata) are scaling up in Tamil Nadu and Karnataka. A new Foxconn plant in Bengaluru, set to launch within weeks, will produce up to 20 million devices annually at peak. Apple’s also boosting its retail presence, with flagship stores in Mumbai and Delhi and stronger online channels, capitalizing on India’s rising middle class and growing demand for premium smartphones—though Android rivals still dominate market share.
The Bigger Picture
The 90-day tariff suspension buys time for U.S.-India trade talks, but the outcome hinges on negotiations, especially with China looming in Trump’s tariff strategy. Apple’s pivot to India—already exporting $17 billion in iPhones—shows how trade policies reshape supply chains. Yet, a contracting U.S. economy and global slowdown risks could complicate India’s tech boom and Apple’s plans. Will the deal hold, and can India become Apple’s manufacturing powerhouse? The clock’s ticking.
Sources
- Trade Deal and QCO Details: Information on the zero-for-zero tariff proposal, QCO concerns, and mutual recognition agreement is from the original text, attributed to sources cited in a Bloomberg report.
- QCO Statistics: The rise from 14 QCOs before 2014 to over 140 since 2017 is from the original text, likely sourced from Indian government or trade data.
- Export Breakdown: The figure that 56.1% of India’s exports are goods is from the original text; no specific source provided but implied from trade statistics.
- www.apple.com
- www.foxconn.com
- www.pegatron.com
- www.wistron.com/en
- www.tata.com
- www.whitehouse.gov
Author, Ryan Bridglal, 05/05/2025