India has overtaken China as the top manufacturer of smartphones shipped to the US, driven by Apple’s production in the country.

According to Canalys, India accounted for 44% of US smartphone shipments in Q2 2025, up sharply from last year.

Vietnam followed with 30%, while China’s share dropped to 25% from over 60%.

Apple tripled its device production in India, though iPhone shipments to the US fell 11% due to earlier inventory stockpiling.

Canalys analyst Runar Bjorhovde noted modest overall market growth of just 1%, citing weak consumer demand.

The shift underscores a broader move to diversify production away from China amid tariff and geopolitical concerns.

.source-ref{font-size:0.85em;color:#666;display:block;margin-top:1em;}a.ask-tia-citation-link:hover{color:#11628d !important;background:#e9f6f5 !important;border-color:#11628d !important;text-decoration:none !important;}@media only screen and (min-width:768px){a.ask-tia-citation-link{font-size:11px !important;}}

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ India’s smartphone manufacturing surge reflects unprecedented industrial transformation

The shift to India as the top US smartphone supplier represents one of the fastest industrial transformations in modern manufacturing history.

India’s mobile phone exports grew from just $0.2 billion in 2017-18 to $24.1 billion in 2024—a significant increase over seven years1.

This growth was supported by the country’s Production Linked Incentive scheme, which helped boost domestic electronics production from $30 billion to $49 billion between 2020 and 20242.

India’s progress is notable, as it went from meeting only 25% of its own domestic smartphone demand in 2014-15 to producing 97% locally while also becoming a major exporter2.

Made-in-India smartphone shipments to the US grew 240% year-on-year in the most recent quarter, showcasing the rapid acceleration of this manufacturing shift3.

2️⃣ Supply chain diversification driven by resilience strategy beyond tariff mitigation

While tariff concerns triggered immediate inventory frontloading, the smartphone manufacturing shift reflects a broader strategic pivot toward supply chain resilience that extends beyond cost considerations.

Research shows that a 1% increase in tariffs can decrease total US trade by approximately 7.25%, making supply chain diversification essential for maintaining market access4.

However, companies are also responding to multiple risk factors including geopolitical tensions, lead time optimization, and environmental concerns that have emerged as key drivers of supply chain shifts5.

The move to India specifically addresses these broader concerns by reducing over-dependence on any single country while building manufacturing capabilities in a politically stable democracy with strong English-language business infrastructure.

This strategic diversification explains why companies like Apple are investing heavily in Indian production capacity even for premium models, signaling a long-term commitment rather than just a temporary tariff-avoidance tactic.

……