Even if the United States imposes a 25 % rate on iPhones manufactured in India, the total cost of production would still be much lower compared to the manufacture of devices in the US, according to a Global Trade Research Initiative (GTR) report.
This occurs amid a statement by US President Donald Trump, threatening to impose 25 % rates on iPhones if Apple decides to do so in India. However, the GTR report showed that manufacturing in India remains economic, despite such tasks.
The report divides the current value chain of an iPhone of US $ 1,000 (approximately RS. 83,400), which involves contributions from more than a dozen countries. Apple maintains most of the value, about $ 450 (approximately RS. 37,530) per device, through its brand, software and design.
He also added that US component manufacturers, such as Qualcomm and Broadcom, add $ 80 (approximately RS. 6,672), while Taiwan contributes $ 150 (approximately RS. 12,510) through chip manufacturing. South Korea adds US $ 90 (approximately RS. 7,506) through OLED screens and memory chips, and Japan provides components worth US $ 85 (approximately RS. 7,089), mainly through camera systems. Germany, Vietnam and Malaysia represent another $ 45 (approximately RS. 3,753) for smaller pieces.
GRTI stated that China and India, despite being the main actors of the iPhone assembly, earn only $ 30 (approximately RS. 2,502) per device. This represents less than 3 % of an iPhone’s total retail price.
The report argues that the manufacture of iPhones in India is still economically viable, even if a 25 % rate is applied.
This is mainly due to the strong difference in labor costs between India and the US in India, the Assembly workers earn approximately $ 230 (about RS. 19.182) per month, while in US states, such as California, labor costs can rise to about $ 2,900 (about RS. 2,41,860) for a month due to minimal laws, an increase of 13 pounds.
As a result, the assembly of an iPhone in India costs about $ 30 (approximately RS. 2,502), while the same process in the US would cost about $ 390 (approximately RS. 32,526). In addition, Apple receives the benefit of production linked to production in the manufacture of iPhone in government India.
If Apple changes production to the US, its iPhone profit could drastically fall from $ 450 (approximately RS. 37,530) to just $ 60 (approximately RS. 5,004) unless retail prices increase significantly.
GTR’s report highlighted how global value chains and hand cost differences make India a competitive option for manufacturing, even in the face of possible US commercial restrictions.
(This story was not edited by the NDTV team and is automatically generated from a union feed.)