Impact of India's New Policy on Apple's Supply Chain and Investment Strategy

Based on my research, I can provide you with a comprehensive analysis of India’s new policy and its impact on Apple’s supply chain and investment strategy.

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India has implemented a significant policy change that allows

[1][2]. This policy, announced in late 2024 and reported on February 1, 2026, represents a major strategic shift in India’s foreign direct investment (FDI) framework for the manufacturing sector [1][2].

Under this new framework, foreign-owned firms can now inject capital directly into the purchase of manufacturing equipment for Indian plants, subject to FDI norms and sector-specific caps [2]. This removes a significant barrier that previously complicated equipment financing for multinational corporations and their contract manufacturers.

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Apple has established a substantial manufacturing presence in India:

Metric	Value
iPhone Manufacturing Units	5 facilities
FY25 Production Value	$22 billion (60% YoY growth)
FY26 H1 Exports	$10 billion (75% YoY increase)
Target Global iPhone Share	32% volume / 26% value by FY2026-27
Production Target (FY2026-27)	Over $34 billion (FOB value)

, creating an ecosystem supporting over 350,000 jobs [2][3].

Company	Investment	Purpose
Foxconn	$550M under Chang Yi Interconnect	AirPods, cables, connectors
Foxconn	₹4,800 crore ($600M) total	AirPods expansion (₹3,000 crore deployed)
Tata Electronics	$150-200 million	60% stake in Pegatron’s Tamil Nadu plant
TD Connex	₹2 billion	Micro-precision components
Aequs	Trial production	MacBook enclosures

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The new policy eliminates complex domestic loan structures, allowing Apple and its contract manufacturers (Foxconn, Wistron, Tata) to

[2]. This streamlines the capital expenditure process and reduces financing costs.

With easier access to equipment funding, Apple can now:

• Deploy advanced assembly lines faster
  for 5G-ready displays and battery technology
• Scale production to meet the ambitious
  32% global iPhone production target
  by FY2026-27
• Increase monthly assembly capacity beyond the current
  30-35 million iPhones
  [2]

The policy enables Apple to:

• Shift production between India and other emerging hubs (Vietnam, Indonesia) while maintaining equipment quality
• Maintain high equipment standards at lower costs
• Create a more adaptable manufacturing network [2]

By allowing foreign-direct-investment in equipment, the policy helps

, mitigating currency volatility and policy uncertainty in India [2].

Equipment financed under the new framework can qualify for India’s

, which offers incentives worth approximately (2024-2029) [2]. This improves return on investment for Apple’s Indian operations.

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Apple has been actively reducing its dependence on China amid:

• Rising geopolitical tensions between the US and China
• Increasing labor costs in China
• Tariff pressures and supply chain vulnerabilities [3][4]

Currently, China still accounts for approximately

, with 55% of Mac products and 80% of iPads assembled there [4]. India’s new policy acceleration comes at a critical time.

Product	Current China Dependency	India’s Role
iPhone	~80%	Target: 32% by FY2026-27
iPad	~80%	20% being shifted
Mac	~55%	Growing (Aequs trial production)
AirPods	90% in Vietnam	Foxconn ramping to 200K units/month

The new policy supports Apple’s goal to make

and positions India as a “pivot node” in Apple’s global supply chain [3].

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India’s policy allowing foreign companies to fund equipment for local manufacturers represents a

for Apple’s supply chain diversification strategy. Key benefits include:

1. Lower financing barriers
   for equipment procurement
2. Faster deployment
   of advanced manufacturing capabilities
3. Reduced financial risk
   through global partnership structures
4. Enhanced competitiveness
   through PLI scheme alignment
5. Strategic acceleration
   of the “China Plus One” strategy

With Apple already producing $22 billion worth of iPhones in India and targeting 32% of global production by FY2026-27, this policy change positions India to become a

for Apple and potentially attract further foreign investment into India’s electronics sector.

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[1] Reuters - “India Hands Apple a Win by Letting Foreign Firms Fund Equipment for Manufacturers” (February 1, 2026)

[2] India Briefing - “India’s iPhone Manufacturing Boom: Apple and Suppliers Eye US$34 Billion Production Milestone by 2026-27”

[3] LinkedIn Analysis - “Apple Ramps Up India Push as Key Vendors Expand”

[4] CNBC - “Apple iPhone Production in China, India in Focus After Trump Tariffs” (April 3, 2025)