India’s Smartphone Exports Surge with Apple Leading the Charge
Apple’s iPhones have propelled India’s smartphone exports to an all-time high of Rs 2 lakh crore ($24 billion) in FY25, according to Union Minister Ashwini Vaishnaw. This remarkable growth demonstrates the increasing prominence of Indian electronics manufacturing in the global market.
Significant Growth in Smartphone Exports
In the recently concluded fiscal year 2025, India’s smartphone exports surged by an impressive 54%. This achievement marks smartphones as one of the country’s leading export categories, with Apple contributing a staggering Rs 1.5 lakh crore ($17.4 billion) alone.
Growth of India’s Electronics Manufacturing
The Minister highlighted that over the past decade, India’s electronics manufacturing sector has expanded fivefold, achieving a compound annual growth rate (CAGR) of 17%.
Additionally, electronics exports witnessed sixfold growth, with annual increases surpassing 20% during the same timeframe. This robust expansion places India as a significant player in the global electronics supply chain.
Strategic Shifts in Apple’s Production
In light of increasing tariffs on key manufacturing regions from the US administration, Apple is exploring production opportunities in India. With India imposing lower import duties at 26% compared to higher tariffs on China (104%) and Vietnam (46%), the company’s production ramp-up in India is a strategic move.
- Apple aims to shift 25% of its iPhone production to India by the end of this year.
- Currently, India manufactures 15% of all iPhones, a significant rise compared to China’s 85% share, as noted by brokerage firm Jefferies.
Logistical Responses to Tariff Changes
The urgency of Apple’s operational adjustments became apparent last week when reports indicated the company dispatched five planeloads of iPhones and other electronics from India to the US within three days to circumvent imminent tariff hikes.
Market Reactions
However, Apple’s stock has faced recent turbulence, witnessing a 22% decline following President Trump’s announcement of extensive tariff measures. This slide resulted in a staggering loss of approximately $700 million in market capitalization.
Zepto’s Remarkable Growth
Amidst the vibrant tech landscape, quick commerce platform Zepto is inching closer to an annualized gross order value (GOV) of nearly $4 billion, representing a 300% year-on-year growth, as reported by CEO Aadit Palicha.
In a recent interview, Palicha expressed confidence that Zepto is nearing Ebitda and operating cash flow breakeven in the upcoming months despite a large net cash reserve on its balance sheet.
Competitive Landscape
When compared to its competitors, Zepto’s primary rival, Zomato’s Blinkit, reported an annualized GOV of $3.6 billion, while Swiggy’s Instamart stands at $1.8 billion.
Disputes over Cash Burn
In the rapidly evolving quick commerce scene, Zomato CEO Deepinder Goyal claimed that the industry is burning Rs 5,000 crore each quarter, attributing a substantial portion of these losses to Zepto. Palicha robustly countered these claims, labeling them as “inaccurate.”
RBI’s New Mandates for UPI Transactions
The Reserve Bank of India (RBI) has granted the National Payments Corporation of India (NPCI) the authority to increase UPI transaction limits for person-to-merchant (P2M) payments.
Currently, P2P and P2M transactions have a cap of Rs 1 lakh. However, certain circumstances will allow P2M payments to exceed Rs 1 lakh, going up to Rs 2 lakh or Rs 5 lakh.
Further Regulatory Framework Changes
In its latest updates, the RBI proposed to make the Regulatory Sandbox framework both ‘theme neutral’ and ‘on tap,’ while also broadening co-lending norms and introducing a generalized regulatory framework.
BharatPe’s Resilient Payments has received RBI approval to operate as an online payment aggregator, which signifies its compliance with regulatory standards to facilitate e-commerce transactions.
Emerging Innovations in Chip Technology
The discourse around semiconductor advancements has shifted with a focus on 2D materials, which can lead to more efficient and cost-effective chip manufacturing. Infosys cofounder S. “Kris” Gopalakrishnan emphasized the need for extensive research into these materials for India’s future.
Global Competitiveness in Semiconductor Manufacturing
Chinese advancements, particularly a one-nanometre RISC-V chip utilizing 2D materials, pose a competitive challenge. Experts stress that India must accelerate its research efforts in advanced materials to build a robust semiconductor ecosystem that is less reliant on external technology.
Introducing Krutrim’s AI Chatbot
In the AI sector, Bhavish Aggarwal is gearing up to launch a homegrown chatbot named ‘Kruti,’ aimed at providing a competitive alternative to global platforms like ChatGPT.
Features of Kruti
Kruti promises instant responses, deep research capabilities, and advanced reasoning, with features that include successful booking of services through applications. Aggarwal aims to tailor the product specifically to the Indian context while ensuring it meets global standards.
Looking Ahead
The launch of Kruti is expected in April, reflecting the growing interest of technology companies in the roll-out of affordable AI infrastructure in India. This initiative showcases a commitment to enhancing local tech capabilities while catering to the unique needs of Indian users.
Conclusion
The rapid evolution of India’s electronics and technology landscape, alongside the emergence of significant players like Apple, Zepto, and Krutrim, signals a promising future. As these companies adapt to changing market dynamics and regulatory environments, India’s role in the global supply chain continues to expand, setting the stage for further innovation and growth.
Questions and Answers
- What was the total value of India’s smartphone exports in FY25?
India’s smartphone exports reached a record Rs 2 lakh crore (~$24 billion) in FY25.
- Which company contributed significantly to this export figure?
Apple contributed Rs 1.5 lakh crore ($17.4 billion) to the total smartphone export figure.
- How much has Zepto’s annualized gross order value grown?
Zepto’s annualized gross order value is nearing $4 billion, reflecting a 300% year-on-year growth.
- What changes has the RBI introduced for UPI transactions?
The RBI has authorized the NPCI to increase UPI transaction limits for P2M payments beyond the current Rs 1 lakh cap.
- What significant advancement is India exploring in semiconductor technology?
India is focusing on the development of 2D materials for more efficient chip manufacturing.
