US President Donald Trump has declared a new set of import duties on goods from India, including a 25% tariff and additional penalty levies. These measures are set to come into force starting August 1. The new tariff on Indian imports has the potential to slow the growth in iPhone exports from India to the United States, which had been gaining significant momentum in recent years. However, experts note that the move does not necessarily create a global trade imbalance or offer an unfair advantage to any particular country.
“While the tariff could slow the growth we’ve seen in iPhone exports from India to the U.S., it doesn’t distort global trade or unfairly favor one country over another,” Faisal Kawoosa, founder and chief analyst at Techarc told Financial Express.
India has surpassed China to emerge as the leading exporter of smartphones to the United States, signaling a major shift in global manufacturing patterns as companies move production away from China due to ongoing tariff concerns, according to research firm Canalys.
Smartphones assembled in India made up 44% of US:
In the second quarter, smartphones assembled in India made up 44% of US. smartphone imports—a sharp rise from just 13% during the same period last year. Canalys also reported that the overall number of smartphones produced in India and shipped to the U.S. has surged by 240% year-over-year.
“This likely means iPhones will become more expensive for Americans. Even if India gains more production volume, the cost difference between China and India is narrowing. Since iPhones are not yet manufactured in Vietnam—which still has a 20% tariff—the main implication is that unless Apple decides to absorb the extra cost, it will likely be passed on to consumers. India has been gaining significant production volume, which is shifting the global dynamics,” Tarun Pathak, Research Director at Counterpoint Research noted.
Apple is reportedly speeding up plans to make most US-bound iPhones:
Apple is said to be accelerating its efforts to produce the majority of iPhones sold in the U.S. at its manufacturing facilities in India this year. The company reportedly aims to have about 25% of its total iPhone production based in India over the next few years.