Will Donald Trump's tariffs affect iPhone prices in India? Answer is...

As geopolitical tensions rise with US President Donald Trump's back-to-back tariff announcements, Apple is quietly reshaping its global manufacturing map, keeping India at the centre. Now, one might be wondering if Trump's reciprocal tariffs will affect the iPhone prices or not. 

In this article, we will discuss in detail whether the US President's new obsession with "tariffs" will affect the price of iPhones in India or not. So far, Trump has issued tariff letters to more than 20 countries including—Algeria, Bangladesh, Bosnia and Herzegovina, Brazil, Brunei, Cambodia, Canada, EU, Indonesia, Iraq, Japan, Kazakhstan, Lao People's Democratic Republic (Laos), Libya, Malaysia, Mexico, Moldova, Myanmar, Philippines, Republic of Serbia, Republic of Tunisia, South Africa, South Korea, Sri Lanka and Thailand. 

Meanwhile, India is still holding its breath, waiting for Trump's tariff letters. The tariff ranges from 20 per cent to 50 per cent, with Brazil facing the highest at 50. 

Will tariffs affect iPhone prices in India?

Going by a report by Economic Times, even with the imposition of reciprocal tariffs, producing iPhones in India will remain cheaper than shifting operations to the United States. Thanks to Prime Minister Narendra Modi government's incentives, a growing supply chain ecosystem, already made massive investments in new facilities. 

India remains next big production site for Apple after China. According to a report from the Global Trade Research Initiative (GTRI), the value of a USD 1,000 iPhone is created across multiple countries. Apple, given its brand, design, and software, bags the biggest share, about USD 450. 

As per the report by the outlet, Taiwan contributes USD 150, South Korea adds USD 90 through OLED screens and memory components, and Japan supplies USD 85 worth of camera systems. US chipmakers like Qualcomm and Broadcom add another USD 80. Smaller contributions from Germany, Vietnam, and Malaysia total around USD 45. In contrast, the actual assembly of the iPhone—done in India and China—adds about USD 30 per device.

Now, let's say Trump imposes a tariff at 25 per cent on Indian goods. Accordingly, the USD 30 assembly cost would rise by 25 per cent, or USD 7.5—taking the cost of each iPhone to USD 37.5. Even in this scenario, the production remains far cheaper that what Apple would have to spend if it manufactured iPhones in the United States. 

The answer is, it can't be said that the price of iPhones will remain unaffected. Although the prices will be adjusted according to the tariffs pounded on India, there won't be a massive change.