Apple overshoots iPhone production target under PLI scheme by 80%

Based on preliminary estimates with the government, the production value in FY26 is estimated to hit ₹227,000 cr, which is an increase of more than 24% over the previous financial year's ₹183,000 cr

Apple Inc has overshot its cumulative target of freight on board (FOB) production value of iPhones committed to the government at the end of the five-year production linked incentive (PLI) scheme for largescale electronics by a staggering 80 per cent. The data is based on figures that key vendors assembling iPhones on the company’s behalf have provided to the government. 

In the PLI period between financial year 2021-22 (FY22) and FY26, which ends in a few days, Apple Inc assembled iPhones through its key vendors worth ₹602,324 crore — based on data with the government up to February, and an average projected for March. 

However, its cumulative target for the five-year period, which it had committed to the government under the scheme to be eligible for the incentives, was only ₹335,331 crore. 

The ramp-up in the production of iPhones in FY26, which is slated to hit 55 million units, was primarily due to the huge increase in exports from India to the US (with capacity being shifted from China) that was seen this financial year. 

Based on preliminary estimates with the government, the production value in FY26 is estimated to hit ₹227,000 crore, which is an increase of more than 24 per cent over the previous financial year’s ₹183,000 crore. 

The huge increase in production of iPhones in India in FY26 was achieved due to the two new but large factories of Tata Electronics and Foxconn, which started commercial production of the phones. As a result, iPhones were now being churned out from five dedicated factories compared to just three in the earlier financial years. 

The substantial increase in the production value has helped Apple Inc to up its exposure to India, which is expected to touch close to 25 per cent of its global production of iPhones by FY26. The government estimates that this would go up to 30 per cent in just a few more years. 

The Cupertino-headquartered company started production slowly in the first year, managing to produce iPhones with a production value of only ₹18,900 crore. But its big push came in the last two years of the scheme, which accounted for 67 per cent of the total production value in the five-year period. 

While the PLI scheme offered incentives ranging from 4-6 per cent, it was capped based on the maximum number and value of phones, which were eligible to get the incentives. However, with Apple Inc producing iPhones much beyond this cap, it has not received incentives on this additional production. 

Also, unlike many of its competitors who have been eligible under the scheme, Apple Inc has focused mostly on the export market for its incentives. However, many of its competitors have received incentives substantially for selling in the domestic market — an issue which has raised questions as to why should the government subsidise domestic consumption in what is a scheme to make India a global export hub.