India has surpassed China to emerge as the leading exporter of smartphones to the United States, as reported by research firm Canalys. This development highlights a significant shift in the manufacturing supply chain away from Beijing, driven by uncertainties related to tariffs. In the second quarter, smartphones manufactured in India constituted 44% of U.S. imports of these devices, marking a substantial rise from a mere 13% during the same period last year. Canalys reported that the total volume of smartphones produced in India surged by 240% compared to the previous year. Conversely, the proportion of Chinese smartphone exports to the U.S. declined to 25% in the quarter ending in June, down from 61% a year prior, according to data released by Canalys on Monday. Additionally, Vietnam’s share of smartphone exports to the U.S. exceeded that of China, reaching 30%.
The increase in shipments from India was largely fueled by Apple’s expedited transition to the country amidst escalating trade uncertainties between the U.S. and China, as noted by Sanyam Chaurasia, principal analyst at Canalys. This marks the first instance where India has exported more smartphones to the U.S. than China. Reports indicate that Apple is hastening its plans to produce the majority of its iPhones sold in the U.S. at Indian factories this year, with aspirations to manufacture approximately a quarter of all iPhones in India over the next few years. Many global manufacturers are progressively relocating their final assembly operations to India, increasing their capacity in the South Asian nation to cater to the U.S. market, according to Renaud Anjoran, executive vice president of Agilian Technology, an electronics manufacturer based in China. Shares of Apple have declined by 14% this year, partly due to concerns regarding its significant exposure to tariff uncertainties and growing competition in the smartphone and artificial intelligence sectors. While the company has commenced assembly of iPhone 16 Pro models in India, it continues to depend heavily on China’s more established manufacturing infrastructure to satisfy U.S. demand for the premium model. In April, Trump enacted a 26% tariff on imports from India, which is considerably lower than the triple-digit tariffs imposed on China at that time before pausing those duties until an Aug 1 deadline.
