India is considering massive subsidies and tariff cuts to boost local electronics and iPhone production to cement the country’s position as a manufacturing powerhouse, according to a new report by Bloomberg.
The Ministry of Electronics and IT is contemplating a subsidy package worth nearly $2.7 billion to local companies that produce components like batteries and cameras. It is also considering tariff cuts on imported parts that are not made locally to reduce production costs for electronics, including smartphones.
The proposed subsidies and tariff cuts will have to be approved by the cabinet before a formal announcement is made during the government’s upcoming budget reveal in February. This move will surely be welcomed by smartphone makers especially Apple as it seeks to boost iPhone production outside China.
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Over the past few years, Apple sought to increase iPhone production in India and elsewhere outside China amid a brewing trade war involving the latter and the United States. India emerged as the perfect candidate due to its massive workforce and developing economy. The iPhone 16 Pro and iPhone 16 Pro Max are the first Pro iPhone models to be assembled in India, with Apple tripling iPhone production in the country over the last 18 months.
The proposed subsidy aims to support components like microprocessors, memory, storage, multi-layered PCBs, camera lenses, and lithium-ion cells. Subsidy amounts are expected to vary based on the component, and will help India bring its electronic tariff rates down to be more in line with countries like China and Malaysia.
