In 1974, a 19-year-old Steve Jobs set out to seek spiritual enlightenment by travelling to India. He stayed at the ashram of the renowned Hindu spiritual master Neem Karoli Baba, although the guru had already passed away when he arrived. Nonetheless, the experience left a deep impression on him. Jobs immersed himself in Indian culture, appreciated its simplicity, and became interested in Zen Buddhism—an influence that later shaped his outlook on life. This encounter led Jobs to embrace minimalism, intuition, and inner direction—ideals that would have a profound impact on Apple’s design philosophy. As he later said, “The people in the Indian countryside don’t use their intellect like we do, they use their intuition instead, and their intuition is far more developed than in the rest of the world. That’s had a big impact on my work.” This respect for intuitive design became central to Apple’s product philosophy.
Apple Inc. operates a geographically dispersed supply chain that combines high-value component manufacturing with mass-scale assembly. The process begins in the United States, where the company is headquartered in Cupertino, overseeing the design of its hardware, software, and in-house silicon chips. China continues to serve as the primary hub for Apple’s manufacturing operations. Most iPhones, iPads, and MacBooks are produced there through long-standing partnerships with firms like Foxconn, Pegatron, and Luxshare.
China’s deep and well-organised supply chain enables Apple to produce at scale and with speed. However, rising labour costs and geopolitical tensions have prompted the company to diversify. India is emerging as a significant second hub. Thanks to government support through various programmes, Apple is increasingly assembling more of its iPhones in India in collaboration with Foxconn, Pegatron, and Tata-owned Wistron. This strategy not only meets local market needs but also positions India as a competitive global export base. Vietnam has become vital for manufacturing components and accessories, such as AirPods, Apple Watch, and some iPads. Taiwan continues to play a niche role as the centre of chip production. Apple also sources high-quality parts like camera sensors from Sony and electronic components from Japan.
Trump’s 25% Tariff Announcement on Apple Lacks Mathematical Credibility
The significance of Apple’s manufacturing decisions can be gauged from the fact that revenue from iPhone sales alone exceeds $200 billion. To put this in perspective, the entire market capitalisation of Reliance Industries was $241.5 billion for FY2023–24. The imposition of a 25% tariff on non-American-made iPhones, as proposed by former President Donald Trump, has raised serious concerns among corporate executives and market analysts. This could lead to a $70–$80 increase in iPhone prices for American consumers, unless Apple decides to absorb the cost. However, even with tariffs, Indian-made iPhones are expected to remain cheaper than those manufactured in the U.S., largely due to lower labour costs.
Estimates from the Global Trade Research Initiative indicate that it costs about $30–$40 in labour to produce an iPhone in India, compared to $390–$400 in the U.S. After factoring in incentives, Apple realises over $300 in savings per unit, allowing the company to export Indian-manufactured devices to Europe, Asia, and the Middle East at higher margins without compromising on quality or efficiency. Despite the 25% tariff, Indian-made iPhones could still offer $250–$270 in savings over their U.S.-made counterparts. This is part of Apple’s broader global strategy aimed at regions where these tariffs do not apply—such as Europe, Asia, the Middle East, and Africa. The Middle East, including the UAE, Saudi Arabia, and Qatar, is becoming a key growth market for Apple. India supports this expansion through shorter shipping times and lower logistics costs, preferential trade access, streamlined customs procedures, and access to Arabic-language content developers for regional integration.
Further support comes from the India-Middle East-Europe Economic Corridor (IMEC), a strategic multi-modal connectivity initiative launched at the G20 Summit 2023 in New Delhi. IMEC’s clean energy goals align with India’s One Sun One World One Grid initiative, complementing Apple’s shift toward renewable energy and global investments in clean energy projects.
What India Offers Tim Cook
Policy Environment and Tax Reforms
India has cultivated a business-friendly environment through landmark reforms. The Production-Linked Incentive (PLI) scheme across 14 sectors offers financial rewards for incremental sales to global manufacturers. Additionally, India has reduced the corporate tax rate to 15% for new manufacturing facilities and streamlined regulatory procedures, offering an efficient entry point for foreign firms. The government also plans to reduce the income tax rate for foreign firms from 40% to 35% starting April 2025 and to exempt most foreign companies from the Minimum Alternate Tax (MAT), provided they lack a permanent establishment in India.
Massive Infrastructure Push
The Union Budget 2025–26 echoes India’s ambitions under the Viksit Bharat @ 2047 vision. An allocation of ₹11.21 lakh crore for infrastructure development will enhance logistics, connectivity, and industrial corridors—key drivers of foreign direct investment.
Digital Economy Reforms
To attract international tech giants, the government has exempted the equalisation levy on digital services. Initially imposed on digital advertising and e-commerce platforms, its removal eases tax compliance burdens for foreign providers, notably companies like Apple.
Improved International Indices
India now ranks 63rd in the World Bank’s Ease of Doing Business report (2020), 39th in IMD’s World Competitiveness Index (2024), and 38th in the World Bank’s Logistics Performance Index (2023). These improvements reflect meaningful structural reforms in business transparency, contract enforcement, and licensing systems.
Strong Market Potential
India’s vast and growing middle class, increasing smartphone penetration, and surging digital adoption make it a critical market for Apple. With over 600 million internet users and a rapidly expanding premium segment, India offers immense potential for both Apple’s devices and services.
Town Square Atmosphere
Apple’s flagship stores in Mumbai and Delhi have evolved into experiential spaces that reflect the company’s global retail philosophy of creating community-oriented “town squares”. These spaces reinforce brand loyalty and enhance Apple’s identity in high-growth economies.
Political and Geopolitical Dynamics
Apple’s expanding footprint in India is driven not just by cost efficiencies and policy incentives but also by the need to diversify supply chains amid growing U.S.–China tensions. India offers a politically stable, affordable alternative.
India’s Comparative Advantage
– India vs. U.S. Subsidies: Foxconn received approximately ₹2,450 crore ($295 million) in Indian government subsidies in FY2023–24. No comparable U.S. support exists.
– Labour Costs: Indian factory workers earn around $2/hour, compared to $20–$25/hour in the U.S.—a tenfold difference.
– Labour Laws: India’s moderate labour regulations are more favourable than the U.S.’s stricter unionised frameworks.
– Workforce Demographics: India’s youthful, expanding workforce is well-suited for labour-intensive manufacturing, unlike the U.S., which faces demographic constraints.
– Export Incentives: India supports export-oriented units with PLI and duty exemptions, unlike the U.S., which lacks export-focused subsidies.
The Bigger Picture
India’s manufacturing landscape is evolving rapidly to suit Apple’s long-term plans. Foxconn, Apple’s largest supplier, is investing $1.49 billion in its Indian arm, Yuzhan Technologies, to establish a new facility in Tamil Nadu. This move supplements existing capacity and signals a deepened commitment. Apple aims to produce 25% of all iPhones in India by the end of FY2025. Already, Apple’s exports from India exceeded $10 billion in the first seven months of FY2025.
This shift is not merely about low-cost manufacturing—it is about reconfiguring global supply chains. While U.S. political rhetoric may call for domestic production, the realities of cost, infrastructure, and scalability render India an indispensable partner in Apple’s global strategy.
India’s Cultural Influence on Apple’s DNA: A Reflection of Soft Power
Apple’s story exemplifies India’s soft power—the ability to shape global ideas, values, and innovation through influence rather than coercion. India’s spiritual traditions, philosophical depth, and cultural openness quietly shaped one of the greatest tech minds of our time. Few appreciate the extent to which India influenced Jobs’ thinking and values, ultimately leaving its mark on Apple’s minimalist design language and global identity.
Jobs’ journey to India in the 1970s left an indelible imprint on his philosophy. Today, as Apple deepens its presence in India—through manufacturing, retail, and market expansion—the relationship between Cupertino and Chennai has come full circle. It reflects not just an economic alliance, but a deeper cultural resonance that began with a barefoot traveller in search of meaning.
About The Author
Kush Sharma is a policy consultant with extensive experience mentoring civil service aspirants
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