iPhone production at risk? Report says India’s smartphone export could go down by 25% amid Iran war

Over the last few years, India has been trying to position itself as a leading destination for smartphone manufacturing, with the government offering incentives such as the Production Linked Incentive (PLI) Scheme. But a new report from Nikkei Asia (cited by 9to5Mac) states that the ongoing Iran conflict could derail India’s booming smartphone exports.

India’s exports may be affected by Iran conflict:

With the cross-traffic of Donald Trump and the subsequent increase in trade competition between the US and China, India has emerged as one of the best alternatives to diversify its manufacturing space. This has reportedly led to the Indian government’s own initiatives to promote manufacturing leading to a surge in exports in the country, with global brands increasing local assembly and overseas shipments.

Citing official data, the report states that India exported mobile phones worth approximately $11 billion in the first half of the fiscal year, starting from April 2025, and this figure increased by 55% compared to the previous year.

But the new report, citing analysts, states that shipments mainly bound for Middle Eastern trade hubs will face significant declines in the coming weeks. He adds that if conflict escalates, smartphone exports from India could fall by 22 to 25% in the coming weeks.

It is said that the impact of the conflict was mostly on logistics and that ‘demand remained relatively resilient’. Companies are reportedly temporarily moving away from hubs like Dubai and Doha and using more direct routes

He also added that Apple was among the major brands less affected by disruptions caused by rerouting shipments.

1 in 4 iPhones sold worldwide are manufactured in India:

A previous report by Bloomberg stated that Apple currently produces approximately 25% of iPhones sold in the world in India, indicating a 53 percent increase in production compared to the previous year.

Reports suggest that Apple will assemble around 55 million iPhones in India by 2025; This figure is higher than the 36 million iPhones collected the previous year. Yet Apple produced approximately 220 million to 230 iPhones last year.

However, China still produces the largest share of iPhones sold worldwide, but the trade war between the US and China has led Apple and its suppliers to move large portions of devices for the American market to alternative manufacturing hubs, with India emerging as the main destination.

The report also states that electronics assembly is still more costly in India compared to manufacturing hubs such as China and Vietnam.