Trump Adds Tariff to Threat: India-made Apple Forbidden Fruit
US President Donald Trump on Friday threatened to impose 'at least' 25% tariff on iPhones sold in the country unless they are made in America, and 'not in India, or anyplace else.'
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US President Donald Trump on Friday threatened to impose 'at least' 25% tariff on iPhones sold in the country unless they are made in America, and 'not in India, or anyplace else.' The development, which came a week after he said he had told Apple chief executive Tim Cook not to build in India, is seen by experts as a negotiation tactic to secure a more favourable trade deal with India.Apple shares plunged more than 4% to a low of nearly $194 on the Nasdaq after Trump's statement. 'I have long ago informed Tim Cook of Apple that I expect iPhones that will be sold in the United States of America will be manufactured and built in the US, not India, or anyplace else. If that is not the case, a tariff of at least 25% must be paid by Apple to the US,' Trump said in a post on Truth Social.The move, if implemented, would hit the Cupertino-based firm, which has been seeking to diversify its production base beyond China, as well as India's electronics manufacturing services ecosystem, which has been supporting not only phone manufacturers but also hundreds of ancillary and downstream component makers beginning to set up shop, according to experts.A section of industry executives, however, said the US administration's move to slap tariffs on Apple would not halt India's strides in electronics manufacturing services.'India is primarily involved in assembly, and even within that, India's piece of the pie is under $40,' said Raja Manickam, founder of fabless chip startup iVP Semiconductor and former chief executive of Tata Electronics. 'I do see that sense will prevail and that Apple will reason with the US government that at least 50% or more of their value addition comes in from chips, IP and software by American companies.'Most of the iPhones sold in the US currently are made in India. Apple's assembly lines in India churned out smartphones worth $22 billion in FY25, with a 60% year-on-year increase in output. Shifting Apple's manufacturing to the US would not be a feasible solution, though, said experts, since that would increase the cost of the iPhone to $3,000 on average, from the current price of around $1,000, owing to the high cost of labour in the US.'Trump's posturing of a potential 25% tariff on 'Made in India' Apple phones will certainly be a dampener on Apple's India plans,' said Jaijit Bhattacharya, president, Centre for Digital Economy Policy Research. 'It brings in regulatory uncertainty for Apple, which in itself is extremely detrimental. Apple was signalled to move out of China into trusted supply chain locations such as India. As it started ramping up in India, conflicting signals have emerged from the US administration.'He said the outcome would be significant uncertainty for Apple, impacting the company's ability to build a resilient supply chain and serve the market.Some experts also said Trump's statement as a strategic move amid trade deal discussions with India.Anurag Agrawal, founder of market researcher Techaisle, said, 'Trump's past actions indicate a willingness to impose tariffs to push for domestic production, and his recent comments suggest he is not pleased with Apple's move to diversify manufacturing to India. Therefore, some form of targeted tariffs remains a possibility. While Trump can impose tariffs, previous threats have often been used as negotiating tactics, and exemptions for electronics (including iPhones) have been granted before.'
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