Can India make all iPhones for the world, replace China as a manufacturing hub?

India is increasingly becoming a viable alternative to China for global manufacturing. 

It’s also happening amind a growing desire among Western nations to “decouple” from China, and "friendshore" manufacturing.

This is driven by geopolitical tensions and supply chain vulnerabilities exposed by the pandemic.

Many multinationals are now eyeing India as the next big hub to make things. 

India has a massive workforce. It is strategically located and shares democratic values with the West. It seems like a natural choice. 

New Delhi has rolled out a raft of schemes to boost domestic manufacturing.

The Indian government, under Prime Minister Narendra Modi, has aggressively promoted initiatives like “Make in India” and the Production Linked Incentive (PLI) scheme to lure foreign companies with tax breaks, subsidies, and streamlined clearances.

India is making huge waves in its drive to become a major chip hub.

Since 2020, the subcontinent has attracted over $17 billion of investment in the industry, after India launched a $10-billion incentive scheme to attract top electronic firms.

Israel's Tower Semiconductor, Taiwan's Foxconn, and a consortium from Singapore have already shown interest to set up. Tech giants like Intel, Qualcomm, and Microsoft have established R&D centers in India, and looking into AI, 5G, and quantum computing.

Electronics production in the country is expected to reach $300 billion by 2026.

Apple, Samsung, and Foxconn have already responded, shifting a portion of their operations to India. 

According to JP Morgan estimates, Apple may manufacture 25% of all iPhones in India by 2025.

Apple is significantly increasing iPhone production in India. Its goal: make most iPhones sold in the US in India by the end of 2026. 

Key contract manufacturers like Foxconn and Hon Hai, along with Tata Electronics, are expanding their Indian facilities.

Today, there are at least 120 mobile phone factories in the subcontinent.

With smartphones, there's just one little snag: US President Donald Trump now wants Apple to move manufacturing back to the mainland America, or he will slap prohibitive tariffs on the California tech giant.

Recent developments:

Foxconn

Foxconn, a Taiwan-based electronics giant and a major contract manufacturer for Apple, is investing heavily in India.

On Friday, the Economic Times reported that Foxconn is investing $2.56 billion in its Devanahalli plant, in the Indian state of Karnataka (in addition to the one in Chapparadahalli), aiming to produce 100,000 iPhones by December.

It already has facilities in Tamil Nadu (Sriperumbudur, Sunguvarchatram and Mettupalayam); and one each Andhra Pradesh (Sri City), Gujarat (Hazira) and Telangana (Kongar Khurd B). Foxconn is also building a new AirPods manufacturing facility in Hyderabad. 

Hon Hai Precision Industry

Hon Hai, the primary iPhone manufacturer, has also invested in India and is expanding its operations, with at least two factories in India. 

Tata Electronics

Tata Electronics has started assembling iPhones at its Hosur facility in Tamil Nadu, including iPhone 16 and 16e models. They are also looking to become a major player in the smartphone supply chain. 

But beneath the headlines and investment pledges lie deep structural questions. 

Can a democracy like India replicate the speed, scale, and industrial efficiency that China’s authoritarian model has enabled?

Or are these attempts at diversification a political mirage — aspirational, but ultimately hampered by democratic complexity, labour unrest, and infrastructural challenges?

Is manufacturing migration from China inevitable — or overstated?

Are companies moving entire supply chains, or just token production to curry favour with Western governments and diversify risk? Is support from New Delhi enough, or is there room to grow?

The question remains: is this a genuine shift or a symbolic hedge?

In December 2020, a violent protest erupted at a Taiwanese-run Wistron iPhone factory in Karnataka, India. 

Thousands of contract workers, alleging months of unpaid wages and exploitative conditions, went on a rampage — destroying assembly lines, overturning vehicles, and causing an estimated $60 million in damage, Bloomberg reported.

The riot underscored a crucial issue: India’s labour relations and industrial work culture still have major gaps compared to China’s tightly controlled, state-coordinated workforce.

In China, labour dissent is swiftly suppressed and large-scale industrial operations benefit from a top-down governance structure that enforces discipline and minimises disruptions. 

India, on the other hand, is a federal democracy with powerful state governments, a vibrant civil society, and entrenched labour protections — factors that can slow down or complicate large-scale manufacturing operations.

China’s meteoric rise as the world’s factory was underpinned by authoritarian governance, extensive state subsidies, massive infrastructure investments, with a highly compliant labour force. 

Government policy in China is often implemented with little resistance, allowing for industrial parks, ports, and power infrastructure to be built at unmatched speed. Multinational corporations have benefited from this “authoritarian efficiency.”

India, by contrast, must navigate the complex terrain of democratic governance. 

Land acquisition for factories often faces resistance from local communities. Environmental and labor regulations, while frequently criticised for being inconsistently enforced, are nonetheless more robust than China’s. 

Court injunctions, media scrutiny, and public protests are common. 

While these features make India a healthier democracy, they can pose major challenges for companies seeking speed, scale, and predictability in their manufacturing operations.

The term “decoupling” has become a buzzword in Western strategic circles, particularly in Washington and Brussels, where there is growing unease about economic overdependence on China.

Policymakers are urging companies to move production to “friendlier” or more politically aligned countries — a strategy often labelled as “friendshoring.”

Beyond policy and geopolitics, there are practical constraints to India’s manufacturing ambitions. 

China boasts world-class infrastructure, from highways and ports to industrial clusters with integrated logistics. Indian infrastructure, while improving, still suffers from delays, underinvestment, and bureaucratic red tape.
Freight movement can be unreliable, and power outages are still frequent in some industrial zones.

One study published in the Journal of Public Economics (February 2025) shows that about half of India's industrial plants have their own generators —  a strong indication of the prevalence of power outages.

Moreover, India faces a significant skills gap. 

While its population is young, only a fraction has the vocational or technical training required for modern electronics manufacturing. 

China invested heavily in workforce training, vocational schools, and STEM education, building a talent pipeline that India is only beginning to replicate.

While a shift is undoubtedly happening, will a full-scale exodus from China actually happen? 

The Chinese manufacturing ecosystem developed over a spand of decades, involving supplier networks, logistics integration, and government support. Even companies that are diversifying are often retaining core operations in China.

Decoupling may end up being more of a strategic balancing act than a true divorce. 

“China + 1” has become the operative strategy — keeping China as a key player, while adding India, Vietnam, or Mexico as secondary manufacturing bases.

For India to truly rival China as the world’s manufacturing centre, key hurdles need attention. 

One key challenge: infrastructure (especially reliability of power). Other equally important ones include labour laws, manpower training, and a self-sustaining supply chain ecosystem.

India’s greatest strength is its democratic vibrancy. If it can harness its demographic dividend and leverage the current geopolitical moment, it may well become a central pillar in the global manufacturing landscape.

The race is on. It’s up to the runners whether to do a sprint — or a marathon.