TN: iPhone Capital of India

India has made a dent in the global sourcing ecosystem, thanks to its mix of talented workforce, robust manufacturing capacities, diversified supplier base, and cost efficiencies. It's a development that has prompted not just the Union govt to rally for ‘source from India,' but even Silicon Valley blue chips like Apple.Early in May, Tim Cook, CEO of Apple, said most iPhones sold in the US from June quarter will be sourced from India, highlighting the growing importance of the country as a global manufacturing hub. Last week, Union minister for communications Jyotiraditya Scindia reiterated this.The numbers tell the story. In 2024, the value of iPhone exports from India hit a record $12.8 billion (around 1.1 lakh crore), marking a 42% increase year-on-year. In the financial year 2024-25, iPhone exports contributed about 1.5 lakh crore to the overall exports of smartphones, which exceeded 2 lakh crore. Apple is aiming to increase its global iPhone production in India, with projections indicating a potential 32% share by 2026-27. As per data from IDC, Apple ships around 23 to 24 crore iPhones per annum globally. The global annual smartphone market is 100 crore plus. The US market accounts for 6 crore iPhones per annum or 60 million units. Compared to that, the Indian market size, which was 1.25 crore units last year for iPhones, could be 1.5 crore units this year, which is 5%-7% of Apple's iPhone market in the US and comparatively smaller. In India, only Tamil Nadu and Karnataka make iPhones. TN accounts for 70%-80% of all iPhones, sourced from India, as it houses Foxconn, Pegatron and Tata Electronics – the sourcing vendors for Apple, while Karnataka handles the rest via Wistron. So, when Apple expands sourcing from India, Tamil Nadu stands to benefit largely. "Tim Cook's announcement is a validation of India's manufacturing capabilities. For TN, this underscores the success of our long-term efforts to build a robust electronics manufacturing ecosystem and nurture talent, enabling us to move up the value chain and attract global leaders in smartphone manufacturing. TN has been primed to seize opportunities when they present themselves," said TN Industries minister TRB Rajaa."India is pushing its manufacturing capability. Apple is already producing 4 crore – 4.1 crore iPhones here in India and exporting to other markets as well as selling in India. If they have to meet the requirement of iPhones for the entire US market (6 crore), besides India (1.5 crore) and a few other markets, it would need to expand the sourcing from India to around 8 crore – 8.5 crore units annually, doubling the existing sourcing capacity," said Navkendar Singh, analyst, IDC – Asia Pacific."This doubling of the capacity is certain as India is on the right track. But this won't happen overnight. It will take two – two and half years. That's how the market is. India is on the right path with policies like the PLI scheme. The tariffs (Trump tariffs) – might altogether disappear or increase. But independent of the tariff, Apple would like to make India its China Plus One source (in competition to Vietnam). It is not just about costing, but also about capability, trained workforce and quality control. India will take some time to scale up its capabilities, but in the longer term it can," he said. At 4 crore iPhones, already 16%-17% of the global production of iPhones takes place in India. At 8 crore it would become 35% and more. "While we refrain from commenting on specific company operations, Tamil Nadu is well equipped to support any expansion in smartphone and electronics manufacturing. Our comprehensive ecosystem, bolstered by the recently launched Tamil Nadu Electronics Components Manufacturing Scheme and a skilled talent pool developed over decades, positions us perfectly to meet the industry's growing demands. Tamil Nadu is today the smartphone manufacturing capital of India and a global manufacturing hotspot," Rajaa said.So, how well is TN equipped to handle this opportunity to double iPhone manufacturing in two years? "We are fully ready. We have been preparing to improve our electronics manufacturing ecosystem for the last 3-4 years. We are readying the land near Chennai and Tier 2 locations like Trichy, where either manufacturers of smartphones or their components suppliers can locate," said state Industries secretary V Arun Roy."Further, we have been creating infrastructure like industrial housing. For Foxconn, we have created a massive facility to house 18,500 women, who were otherwise staying outside the campus. Now those places have been freed and can accommodate newer employees also, based on demand. We will take up new projects also. Already units totalling 5,000 beds in various regions are under development. Tata Electronics is also building a 15,000-bed facility near Hosur. Infrastructure like tertiary treated water supplies are being created and are available for use. On the labour front, through the Naan Mudhalvan scheme, an electronics manufacturing-ready workforce has been deployed and ITIs have been upgraded to Industry 4.0 standards to include component manufacturing requirements like enclosures and metal components manufacturing. We feel there is enough industry-ready manpower to meet an increased demand," he added.Get the latest lifestyle updates on Times of India, along with Mother's Day wishes, messages, and quotes !