Introduction:
In a bold move, US President Donald Trump has issued a fresh warning to Apple, threatening a 25% tariff on iPhones and other products if they are not manufactured in the United States. This statement, made on May 23, 2025, directly challenges Apple’s growing manufacturing operations in India, raising questions about the future of the ‘Make in India’ initiative and global trade dynamics. The Apple iPhones manufactured in India are comparatively cheaper in USA than any other part of the world.
Trump’s Stance: Manufacture in the US or Face Tariffs:
During a speech in the White House Oval Office while signing executive orders on nuclear energy, Trump emphasized his expectation that iPhones sold in the US should be made domestically. “It’s okay for Apple to go to India to build its plants, but then the tech company will not be able to sell its products in America without tariffs,” Trump stated. He further clarified that this policy extends beyond Apple to other smartphone manufacturers like Samsung, with tariffs set to take effect by the end of June 2025.
Trump’s comments follow a conversation with Apple CEO Tim Cook, where he expressed frustration over Apple’s expanding operations in India. “I have long ago informed Tim Cook of Apple that I expect their iPhones that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump posted on social media. This is not the first time Trump has raised this concern—during a recent trip to Doha, he urged Cook to focus on building in the US instead of India. You may also like to go through one of our article published in February-2025related this topic here on Trade War.
Apple’s ‘Make in India’ Push: A Strategic Shift:
Apple has been aggressively expanding its manufacturing footprint in India as part of the ‘Make in India’ initiative, which aims to position India as a global manufacturing hub. The company has partnered with firms like Foxconn, Tata Electronics, and Pegatron to produce iPhones and AirPods in India, primarily for export markets. In 2024 alone, India contributed to 15% of global iPhone production, with exports reaching Rs 1.5 lakh crore in fiscal year 2025, according to Union Minister Ashwini Vaishnaw.
This shift has been a significant win for India, creating around 2 lakh jobs across Apple’s vendor operations. However, Trump’s tariff threat could disrupt these plans, forcing Apple to reconsider its supply chain strategy. The company has already taken steps to mitigate potential tariffs, airlifting $2 billion worth of iPhones from India to the US in March 2025 to preempt earlier tariff impositions.
Impact on India’s Manufacturing Dreams:
Trump’s tariff threat poses a significant challenge to India’s ambition to become a global manufacturing powerhouse. The ‘Make in India’ initiative has attracted major tech firms like Apple, but the new tariffs could deter further investment. If Apple and other manufacturers face a 25% tariff on products made in India, they may either absorb the cost—potentially raising iPhone prices—or shift production back to the US, which could take years and significantly increase costs.
Analysts estimate that moving iPhone production entirely to the US could take up to a decade and result in iPhones costing as much as $3,500 each, compared to the current top-of-the-line price of around $1,200. This price hike could hurt Apple’s market share in the US, where it sold 75.9 million iPhones in 2024, according to S&P Global.
Global Trade Implications: Beyond Apple:
Trump’s tariff policy isn’t limited to Apple—it applies to all smartphone manufacturers selling in the US. “It would also be Samsung and anybody that makes that product, otherwise it wouldn’t be fair,” Trump told reporters in Washington. This broad approach signals a protectionist stance aimed at reshoring jobs to the US, but it risks escalating global trade tensions.
India, which has been negotiating a trade deal with the US, may face additional pressure. Trump recently claimed India offered a “no-tariff” deal, a statement disputed by India’s Foreign Minister S. Jaishankar, who emphasized that negotiations are ongoing and any deal must be mutually beneficial. The tariff threat could complicate these talks, especially as India seeks exemptions for its labor-intensive sectors.
What’s Next for Apple and India?
Apple now faces a tough decision: comply with Trump’s demands by shifting production to the US, absorb the tariffs and risk higher prices, or negotiate a workaround. For India, the stakes are high. The country has positioned itself as an alternative to China in global supply chains, but Trump’s policies could slow this momentum.
Despite the challenges, India remains a critical part of Apple’s strategy. The company’s exports from India to the US jumped 219% in March 2025, with 97.6% of its Indian-made iPhones destined for the US market. This indicates Apple’s proactive approach to navigating tariff uncertainties, but the long-term impact of Trump’s policies remains uncertain.
Conclusion: Navigating a Protectionist Era:
Donald Trump’s tariff threat to Apple underscores the complexities of global trade in a protectionist era. For India, the challenge is to maintain its manufacturing growth while navigating US trade policies. For Apple, the balance between cost, production, and market access will be crucial. As the June 2025 deadline approaches, all eyes will be on how this unfolds and what it means for the future of ‘Make in India.’
Frequently Asked Questions (FAQs)
What is Trump’s tariff threat to Apple?
Trump has threatened a 25% tariff on Apple products, including iPhones, if they are not manufactured in the US. This policy also applies to other smartphone makers like Samsung.
How does this affect India’s ‘Make in India’ initiative?
The tariff threat could deter companies like Apple from expanding manufacturing in India, potentially slowing the growth of the ‘Make in India’ initiative and affecting job creation.
Will iPhone prices increase due to the tariffs?
If Apple absorbs the tariffs or shifts production to the US, iPhone prices could rise significantly, with estimates suggesting a top-end iPhone could cost $3,500.
Sources:
This article references a report by the Times of India, detailing Donald Trump’s tariff threat to Apple on May 23, 2025 (Times of India). Additional data on iPhone sales in the US is sourced from S&P Global.
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