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This will be almost five times the INR 10,000 Cr worth of iPhones made in the country in the last fiscal year by Foxconn and Wistron

This is the second year of the PLI scheme first introduced in March 2020 in the country, targeting three industries, one of them being mobile manufacturing

To qualify for incentives for the second year under the PLI for smartphones, the expected production of iPhones this fiscal is more than twice the requirements for the company

Electronics giant Apple is ramping up its production in India as its contract manufacturers are likely to make iPhones worth INR 47,000 Cr in FY22-23. It seems the government’s production linked incentives (PIL) scheme, introduced two years ago, has helped it.    

This will be almost five times the INR 10,000 Cr worth of iPhones made in the country in the last fiscal year by Foxconn, having a plant in Tamil Nadu, and Wistron, which has a plant in Karnataka (Narasapura).

This is the second year of the PLI scheme first introduced in March 2020 in the country, targeting three industries – mobile manufacturing and electric components, pharmaceutical, and medical device manufacturing. The objective was to move smartphone manufacturing units away from China and Vietnam to India.

In the second round of the PLI scheme for mobile phone and electronic component manufacturing, incentives of 5% to 3% shall be extended on incremental sales of goods manufactured in India and covered under the segment for a period of four years.

To qualify for incentives for the second consecutive year under the PLI for smartphones, the expected production of iPhones this fiscal is more than twice the requirements for the California-based company. As per the scheme, each of the contract manufacturers – Foxconn, Wistron and Pegatron – should manufacture iPhones worth INR 8,000 Cr each.

Wistron and Pegatron (Tamil Nadu), which started production in April 2022, mainly manufacture the iPhone 12, while Foxconn manufactures iPhones 11, and 12. The company started the production of its latest phone – iPhone 13 – at its Chennai plant earlier this month with Foxconn (Sriperumbudur). 

The iPhone manufacturer may see shipment of 7 Mn units this fiscal, giving it its highest ever market share of 5.5%. However, India constitutes less than 1.5% of Apple’s global sales; more than 60% of the production of iPhones will be for exports, which is one of the primary goals of the PLI Scheme.

Meanwhile, Apple shipped about 1 Mn ‘Made in India’ iPhones in the country in Q1 of 2022, representing a 50% year-on-year (YoY) growth, a Cyber Media Research showed.

In Q1 of 2022, iPhones sales in India grew by 22%, led by iPhone 12 and iPhone 13. iPhone 12 led the pack with 52% of the shipments, followed by iPhone 13 with 20%, the report said. It was followed closely by iPhone 11, which formed 18% of the total shipments in India. 

Apple started manufacturing iPhones in 2017 in the country with the low-priced iPhone SE. It later began manufacturing iPhone 12 and iPhone 13 within the country. ‘Made in India’ iPhones make up about 70% of the company’s smartphone sales in the country. 

However, this 70% coming from its manufacturing partners in India is a small trickle compared to the waterfall of China manufactured products. 

In January this year, the government urged Apple to develop India as a global base to export fully-built products to the rest of the world, and to generate annual production output worth $5 Bn in the next five to six years.