Made In India: Backed By PLI Scheme, Apple Likely To Manufacture iPhones Worth Rs 47,000 Crore In FY23

Out of the three manufacturers of iPhones in India, two, Pegatron and Foxconn, manufacture the phones in Tamil Nadu. Wistron has a manufacturing facility in Bengaluru.

New Delhi: Apple is likely to make iPhones worth Rs 47,000 crore in India in FY23, almost five times the Rs 10,000 crore worth of phones manufactured in FY22. According to Economic Times, the second phase of the Production-Linked Incentive (PLI) scheme started in April and it is expected to give a big boost to the production of iPhones. Under the scheme, each of the three contract manufacturers of iPhone Foxconn, Wistron and Pegatron are required to manufacture phones worth Rs 8,000 crore.

In India, the manufacturing of iPhones started with the production of the iPhone SE in 2017. Currently, many models including iPhones 11, 12 and 13 are manufactured in the country. Out of the three manufacturers, two, Pegatron and Foxconn, manufacture the phones in Tamil Nadu. Wistron has a manufacturing facility in Bengaluru.

Along with smartphones, the government of India had also initiated an incentive scheme worth $10 billion to produce semiconductors. The world has been reeling under the scarcity of semiconductors since the onset of the Covid-19 pandemic. They are used in almost every electronic device including smartphones, laptops and e-vehicles.

What is Production-Linked Incentive (PLI) Scheme for Smartphones?

The PLI scheme for smartphone manufacturing comes under the PLI scheme for large scale electronics manufacturing. Under the scheme, the government provides various types of incentives to companies, if they produce products in India. According to an official notification by the Government of India, “The domestic electronics hardware manufacturing sector faces a lack of a level playing field vis-à-vis competing nations. The sector suffers disability of around 8.5% to 11% on account of lack of adequate infrastructure, domestic supply chain and logistics; high cost of finance; inadequate availability of quality power; limited design capabilities and focus on R&D by the industry; and inadequacies in skill development.”

Through the PLI scheme, the government is hoping to remove these barriers. Implemented on April 1, 2022, the scheme offers incentives for the ‘Assembly, Testing, Marking and Packaging (ATMP)’ of the phones. The government offers cashback in the range of 4-6 per cent to remove the disability. Also, it hopes to pull investors away from Vietnam and China as they are leading manufacturers of smartphones.

For the period of 5 years, the government has allocated over Rs 40,000 crore to be given out under the scheme.