'Made in India iPhones will still be cheaper, even with Trumps 25% Rate: GTri Report

New -delhi [India]May 24 (ANI): Even if the United States impose a 25 percent rate on iPhones in India, the total production costs would still be much lower if compared to the manufacture of the US devices, according to a report of the Global Trade Research Initiative (GTRI). This comes amid a statement from US President Donald Trump, who threatens to impose 25 percent rates on iPhones if Apple decides to make it in India. However, the GTRI report has shown that manufacturing in India remains cost-effective, despite such duties. The report breaks the current value chain of a USD 1,000 iPhone, which involves contributions from more than a dozen countries. Apple retains most of the value, approximately USD 450 per device, through its brand, software and design. It also added that US component manufacturers, such as Qualcomm and Broadcom, add USD 80, while Taiwan USD 150 contributes to the manufacture of Chip. South Korea adds USD 90 to via OLED screens and memory chips, and Japan delivers components worth USD 85, mainly through camera systems. Germany, Vietnam and Malaysia are responsible for another USD 45 by smaller parts. Gtri said China and India, despite being the most important players of the iPhone meeting, earn only about 30 per device. This is less than 3 percent of the total selling price of an iPhone. The report argues that the manufacture of iPhones in India is still economically viable, even if a 25 percent tariff is applied. This is mainly due to the sharp difference in labor costs between India and the US in India, and meeting workers earn about 230 dollars a month, while labor costs in the US states such as California can rise to about $ 2,900 per month due to minimum wage laws, a 13-fold increase. As a result, the composition of an iPhone in India costs about USD 30, while the same process in the US would cost about $ 390. In addition to this Apple, Apple receives the advantage of the production-linked incentive (PLI) for the manufacture of iPhone in India from government. If Apple moved production to the US, the profit per iPhone could drastically fall from USD 450 to just USD 60, unless retail prices are significantly increased. The GTRI report has emphasized how global value chains and labor costs make India a competitive option for manufacturing, even in the midst of possible US trade restrictions. (Ani)