For the first time, India has overtaken China to become the largest exporter of smartphones to the United States, marking a dramatic shift in the global tech supply chain. This development is not just about numbers, it encapsulates years of geopolitical tensions, shifting trade policies, and Apple’s calculated gamble to realign its manufacturing operation.
The recent data from Canalys (now part of Omdia) illustrates just how rapidly things have changed. In the second quarter of 2025, 44% of smartphones shipped to the U.S. were assembled in India. A year ago, that figure was only 13%. At the same time, China’s share of U.S. smartphone shipments plummeted from 61% to just 25%. The surge for India is eye-catching, a staggering 240% year-over-year growth in “Made-in-India” phones now graces retailer shelves across the U.S.
Driving this tectonic shift is Apple Inc. (NASDAQ: AAPL). Tariff anxiety and the prospect of escalating trade frictions between Washington and Beijing have pushed Apple to diversify its supply chain at an unprecedented pace. Starting with lower-cost models, Apple accelerated production of flagship iPhones in India over the last couple of years, culminating in the assembly of the latest iPhone 16 Pro models in South Asia by this quarter. Much of India’s newfound export dominance can be traced back directly to Apple’s pivot.
Why did Apple, and the wider tech industry, make this move? It comes down to risk management. Negotiations between the United States and China have grown fraught, occasionally resulting in sweeping tariffs and industry-wide uncertainty. While smartphones have so far dodged the highest tariffs, the exemption has always looked temporary. In response, Apple set out to buffer itself. The company worked closely with its manufacturing partners like Foxconn and Tata to scale up production in India, a process that was accelerated each time new tariff concerns flooded the headlines.
The outcome hasn’t just been strategic for Apple. Prime Minister Narendra Modi’s government in India seized the opportunity, eliminating certain import taxes on phone components and luring global brands to help build a competitive electronics hub. India’s policymakers envisioned the country as a global smartphone factory, and, with the help of companies like Apple, that vision is materializing. There’s still a cost premium, making iPhones in India isn’t as cheap as making them in China, and for now Indian-assembled units cost more to produce, but with the balance of risk tipping and capital investments rolling in, these are seen as manageable headwinds.
The broader US smartphone market has felt the effects, too. Overall, shipments in the U.S. rose just 1% year over year in Q2, a modest bump in a market that has lately seen more drama in supply chains than on sales floors. Notably, Samsung saw a remarkable 38% jump in US-bound shipments in the same period, largely thanks to its Galaxy A-series. But there’s no mistaking that the lion’s share of the manufacturing spotlight remains on Apple and its Indian partners for now.
Interestingly, this rapid realignment has not yet solved every problem for Apple or the industry. Meeting full U.S. demand still means some manufacturing continues in China, and India must double or even triple current output to completely supplant China’s role in Apple’s global playbook. Furthermore, Apple’s new supply chain brings fresh challenges, such as the need to develop India’s semiconductor ecosystem. Foxconn, the world’s biggest contract electronics manufacturer, recently received approval to build a $433 million chip plant in Uttar Pradesh, further signaling the long-term commitment to India as a production powerhouse.
From a global perspective, what’s happening here is a case study in how the intersection of business strategy, politics, and government policy can upend decades of established practice in one of the world’s most complex industries. As of this quarter, every time an American shops for a smartphone, there’s a better chance than ever that it’ll be “Made in India”, a phrase that as recently as last year, would have been unthinkable on this kind of scale.
