Apple caught in the crossfire of U.S.-India trade strategy

U.S. President Donald Trump has intensified trade debate by proposing a 25% tariff on Apple iPhones manufactured outside the United States. While presented as a strategy to bring jobs back to the U.S., industry analysts largely interpret it as a political gesture rather than an actionable policy, given the complexity of Apple’s global supply network. Apple CEO Tim Cook has indicated that large-scale Apple iPhone production in the U.S. would not be feasible for at least several years, and only then through automation. This raises questions about potential job creation, as robot-led assembly lines would not generate traditional manufacturing employment.

The prospect of such tariffs adds a layer of uncertainty that often unsettles markets, including the global secondary mobile sector. Industry observers expect prices of used devices to rise, as fewer consumers may be willing to trade in their phones amid fears of rising costs and supply chain instability.

India ramps up iPhone exports

India’s role in Apple’s supply chain continues to grow. According to Canalys, 3 million Apple iPhones were shipped from India to the U.S. in April 2025 – a 76% year-on-year increase. Meanwhile, iPhone shipments from China fell sharply by the same 76%, dropping to just 900,000 units. The shift underscores Apple’s strategy to reduce dependency on China, according to Canalys.

Foxconn deepens India investment

Foxconn, a key Apple supplier, recently announced a € 1.38 billion investment in its Chennai facility. The move reinforces India’s position in manufacturing high-end Apple iPhones, including Pro models. The investment is widely seen as a long-term bet on India’s manufacturing capabilities.

U.S. tariffs unlikely to shift production

While Trump’s tariff threats could pressure Apple, actual relocation of production to the U.S. faces major hurdles. Costs could soar, with one estimate suggesting U.S.-made iPhones might retail for €3,200. Legal challenges and the absence of mature automation technology further complicate such a shift.

India walks a diplomatic tightrope

India stands to gain reputationally as a trusted, non-China manufacturing partner. However, it must navigate U.S. domestic politics carefully. Quiet lobbying, export-linked incentives, and stability assurances may help maintain Apple’s growing presence in India.