India Surpasses China in Smartphone Manufacturing
India apparently eclipsed China in smartphone manufacturing during the second quarter of 2025, marking a significant departure from China’s longstanding dominance amid ongoing trade uncertainties.
The last six months have seen the Trump administration implement tough tariffs and other trade measures that have, well, shaken up the global economy. Companies are adapting, and the smartphone sector is definitely feeling this impact.
“Apple has ramped up its production capacity in India over recent years as part of a strategy that includes other regions, particularly focusing much of its Indian export capacity toward the US market through 2025,” explained an analyst.
According to a fresh report from Canalys, US smartphone shipments dropped dramatically, from 61% last year to just 25%. This decline has notably benefited India, which now accounts for 44% of the total cargo volume headed to the US.
This surge in “Made in India” smartphones—a staggering 240% increase from the previous year—plays a key role in this shift.
Canalys pointed to “uncertain trade landscapes” as a major factor driving this pivot away from China amid evolving tariff dynamics between the two countries.
“In the second quarter of 2025, India emerged as the principal manufacturing hub for smartphones intended for the US market,” said Sanyam Chaurasia, principal analyst at Canalys.
Many experts highlight Apple’s “China Plus One” strategy as pivotal in this transformation, which involves diversifying production across Asia, focusing on places like India and Vietnam. Vietnam, in particular, is gaining traction as a key manufacturing base for companies like Samsung.
Chaurasia elaborated, stating, “Apple’s enhancement of its production capabilities in India aligns with its goals under the ‘China Plus One’ strategy, with a noticeable emphasis on meeting US market demands.” This approach seems to aim at mitigating risks tied to relying solely on one region while capitalizing on lower labor costs in Southeast Asia.
The thought of completely displacing China, a key manufacturing center for Apple, appears daunting. After all, China continues to be crucial for assembling premium products and supplying essential semiconductors, complicating any efforts to completely shift operations.
Reports have surfaced suggesting that Trump urged Apple to reconsider its Indian expansion in favor of moving production back to the US. However, Apple found this demand impractical due to higher labor costs and challenges in scaling manufacturing in the US.
While Trump’s administration has made significant moves to encourage businesses to return to the US, the resulting tariffs have led to varying strategies as companies reassess their long-term plans.
“This tactic is classic Trump. He wishes to see Apple localize more and develop a production network within the US. But, let’s face it—manufacturing in the US is considerably more expensive than producing in India,” some commentators noted.
As of now, Apple has not publicly commented on these developments.
