India's Technological Ascent: Tata’s iPhone Production Deal Elevates National Stature

India Asia

India's technological landscape is transforming. Tata Group's latest move to manufacture iPhones in India marks a significant shift in the global tech supply chain.

In a move signalling India's accelerating prominence in the global technological supply chain, Tata Electronics Pvt Ltd (TEPL), part of the colossal Tata Group, is set to acquire Wistron’s operations in India. This $125 million deal paves the way for the Indian conglomerate to become the first indigenous company to manufacture iPhones, an emblem of high-tech prestige.

This acquisition not only exemplifies Tata's expansion into high-tech manufacturing but also strategically positions the conglomerate at the forefront of the evolving international technological supply chain. By producing devices like the iPhone, Tata underscores India's growing technological capabilities, reinforcing its status as a key player in global tech innovation and production.

This strategic acquisition underscores a major shift in the global dynamics of electronics manufacturing, a sector long dominated by China. Taipei-based Wistron Corporation, which is divesting its 100% stake in Wistron InfoComm Manufacturing (India) Pvt. Ltd. to TEPL, will bolster Tata’s footprint in the tech manufacturing domain.

India’s federal information technology minister, Ashwini Vaishnaw, issued the following statement on X: “Made in India iPhones… by Tata.”

Rajeev Chandrasekhar, India’s federal Minister of State for Electronics and Information Technology, sees this as a catalyst for the next investment cycle in the Indian electronics sector, signalling the maturity of India's electronic manufacturing services (EMS). The take-home message is clear: Indian manufacturing is ready to play in the major leagues.

Tata’s entry into this arena is not an isolated event but part of a larger, deliberate strategy. Group chairperson N. Chandrasekaran’s ambition to turn Tata into a mobile phone and component manufacturing powerhouse reflects a strategic realignment in response to the geopolitical distancing from China. This is particularly relevant for tech giants like Apple, which are seeking alternative production bases.

The infrastructure for such an audacious move has been in the making. Wistron’s facilities include four assembly lines in the Kolar industrial area, with a workforce of up to 15,000. These resources, now under Tata’s wing, will be instrumental in scaling up production.

Over the past half-decade, India has been quietly but steadily carving a niche in the iPhone manufacturing ecosystem. Commencing with Foxconn’s production of the iPhone SE in 2017, India has seen a progressive addition of the latest Apple models to its production lines. Apple’s contract partners—Foxconn, Wistron, and Pegatron—have not just been manufacturing for the local market but also for export.

The statistics are telling; JPMorgan reports that Apple intends to shift a quarter of its iPhone production to India by 2025. India’s share of global iPhone shipments is expected to double by the end of 2023, fulfilling most of the local demand and significantly contributing to exports. This coincides with the decrease in China’s share in global iPhone production, marking a pivotal redistribution of the tech manufacturing landscape.

Apple is not alone in this journey. Google, too, has cast its lot with India, as CEO Sundar Pichai announced plans for manufacturing the Pixel 8 in India. The Tensor chip that powers this device was designed in India, reflecting the country's growing expertise not just in manufacturing but also in semiconductor design.

Amidst these shifts, Tata’s investment in semiconductor capabilities cannot be overlooked. With a proposed $90 billion investment roadmap over five years, the conglomerate is not just eyeing the present but is strategically aiming for future readiness, including component-level production for burgeoning sectors like electric vehicles.

Moreover, the move could also act as a magnet for foreign investment, signalling to the world that India is open to high-tech business.

In conclusion, Tata’s acquisition of Wistron’s iPhone production operations is more than a corporate transaction. It is a landmark in India’s path to becoming a central hub in the international tech supply chain. With each iPhone that rolls out of a Tata-managed facility, the narrative of ‘Made in India’ grows stronger, not just within the country's borders but on the global stage. The future sparkles with promise, and it is distinctly digital.

Mrittika Guha Sarkar is a young professional at the East-West Centre in Washington. She is a graduate student at American University’s School of International Service. She is also an Associated Research Fellow at the Institute for Security & Development Policy (ISDP), Sweden.