India overtakes China in smartphone exports to the U.S. as manufacturing jumps 240%, report shows

India has surpassed China to emerge as the leading exporter of smartphones to the United States, according to a report by research firm Canalys. This shift reflects a significant change in the global manufacturing supply chain, as companies seek alternatives to Beijing amidst ongoing tariff-related uncertainties. In the second quarter, smartphones assembled in India made up 44% of U.S. imports, a remarkable rise from just 13% in the same quarter last year. The total volume of smartphones produced in India has skyrocketed by 240% year-on-year, Canalys noted. Meanwhile, the share of Chinese smartphone exports to the U.S. has declined sharply to 25%, down from 61% a year prior. Vietnam also saw an increase, capturing 30% of the U.S. smartphone export market. This remarkable rise in shipments from India is primarily driven by Apple's accelerated manufacturing shift to the country, particularly during a time of increasing trade tensions between the U.S. and China. Sanyam Chaurasia, a principal analyst at Canalys, highlighted that this marks the first instance where India has exported more smartphones to the U.S. than China. Apple is reportedly fast-tracking its plans to manufacture a significant portion of its iPhones sold in the U.S. within Indian factories, aiming to produce approximately a quarter of all iPhones in the country in the coming years. Former President Trump had previously threatened Apple with additional tariffs and encouraged CEO Tim Cook to manufacture iPhones domestically, a move analysts believe would be nearly impossible without inflating prices. While many of Apple's key products, including iPhones and Mac laptops, have received exemptions from Trump's tariffs, experts caution that these exemptions could be temporary. Other major players, such as Samsung and Motorola, are also attempting to shift their U.S.-bound smartphone assembly to India, although their progress has been slower and less extensive compared to Apple. Renauld Anjoran, CEO of Agilian Technology, an electronics manufacturer based in China, noted that global manufacturers are increasingly relocating their final assembly to India to better serve the U.S. market. Anjoran's company is currently renovating a facility in India and is set to begin trial production runs soon, ramping up to full-scale manufacturing thereafter. While the number of devices shipped to retailers does not directly indicate final sales, it serves as a useful proxy for market demand. Canalys reported that overall iPhone shipments decreased by 11% year-on-year, totaling 13.3 million units in the second quarter, a sharp contrast to the 25% growth witnessed in the previous quarter. Apple’s shares have fallen 14% this year, fueled by concerns over tariff exposure and escalating competition in both the smartphone and artificial intelligence markets. Although Apple has begun assembling iPhone 16 Pro models in India, it still relies heavily on China's established manufacturing infrastructure to meet U.S. demand for this premium model. In April, Trump had imposed a 26% tariff on imports from India, significantly lower than the steep tariffs on China, but paused those duties until an August 1 deadline.