India is preparing a fresh round of financial incentives for smartphone manufacturers to keep production growing within its borders. With the country’s highly successful Production-Linked Incentive program set to expire at the end of March 2026, policymakers are drafting a new framework designed to benefit major tech companies like Apple and Samsung.
The original subsidy program was a massive $21 billion effort that successfully transformed India into a smartphone assembly hub. Today, nearly every smartphone sold in India is built locally. Because that initial goal has largely been met, the government is updating its strategy. The upcoming plan will reportedly tie financial rewards directly to export volumes and the use of locally sourced components.
India is shifting focus from domestic assembly to global exports
Indian officials want to transform the country into a global distribution center rather than just a massive domestic market. By linking subsidies to overseas shipments, the policy encourages brands to manufacture devices in India specifically for international buyers.
This policy shift perfectly aligns with Apple’s current trajectory. The company has aggressively expanded its Indian manufacturing footprint, assembling roughly 55 million iPhones in the country during 2025. That accounts for about a quarter of Apple’s total global iPhone output.
In fact, Apple is reportedly planning to manufacture most of its US-bound iPhones in India by the end of 2026. This move is largely driven by a desire to avoid heavy tariffs and reduce a long-standing reliance on Chinese factories.
Why this matters for the broader supply chain
What this really means is that India is moving up the manufacturing ladder. The proposed incentives will likely use a tiered system, offering higher payouts to companies that source complex parts like camera modules and display assemblies from local Indian suppliers.
While final assembly is booming, building a deep and reliable supply chain takes time. India still imports many high-value components from places like Taiwan and South Korea. However, the revised incentive structure is a clear signal that the government is serious about its goal to expand the domestic electronics sector to $500 billion annually by 2030.
If the new subsidies work as intended, they will firmly embed India into the center of the global consumer electronics trade.
