Why Donald Trump’s 50% India tariffs won’t raise iPhone prices for now

President Donald Trump has signed an executive order doubling tariffs on Indian imports. The 50 per cent levy, announced on 6 August, will take effect from 27 August and comes on top of the 25 per cent tariff introduced earlier this month.

Trump linked the decision to national security, pointing to India’s continued purchase of Russian oil. The order stated that India’s energy trade was helping Moscow fund its war in Ukraine. The US president accused New Delhi of indirectly supporting Russia’s war effort by continuing large-scale imports.

Also Read: Trump Tariffs India: Trump admin pushes ahead with plans to implement 50% tariff on India; notice issued

Why Apple will not take a hit?

Despite the sweeping tariffs, Apple’s iPhone exports from India remain untouched for now. In April, the Trump administration exempted smartphones, computers and other electronic goods from reciprocal tariffs. This exemption was extended under a separate tariff authority that has yet to be unveiled publicly.

As a result, Apple’s semiconductor-powered devices, including iPhones, continue to enter the US without extra duties. That exemption has offered breathing space not just for Apple but also for other technology firms like Nvidia.

Apple’s rapid shift from China to India

India has become a cornerstone of Apple’s global supply chain. Data from Counterpoint Research shows that 71 per cent of iPhones sold in the US between April and June were made in India, up sharply from 31 per cent a year earlier.

Customs figures accessed by Reuters reveal that Foxconn exported 3.2 billion dollars’ worth of iPhones from India between March and May this year, with an average of 97 per cent going to the US.

According to a TOI report, during Apple’s second quarter results, CEO Tim Cook told analysts, “In terms of the country of origin, it's the same as I referenced last quarter. There hasn't been a change to that, which is the vast majority of the iPhone sold in the US or the majority, I should say, have a country of origin of India.”

Apple first pushed production into India after COVID-19 supply disruptions in China and has since accelerated output to shield itself from tariffs on Chinese goods. India now accounts for more than a fifth of Apple’s global iPhone production and has already overtaken China as the largest supplier to the US.

Also Read: Apple resists Trump’s warning, says no pause on India's iPhone expansion

Exemptions under review

The reprieve may be short-lived. The US Commerce Department is conducting a review under Section 232 of the Trade Expansion Act, which covers sectors vital to national security such as semiconductors. Until that process concludes, smartphones, including iPhones from India, face no extra charges.

But Trump has made his position clear. He said no one is “getting off the hook” and confirmed his administration is planning specific semiconductor levies that could affect Apple in the future.

Bloomberg reported that if exemptions are withdrawn, locally assembled iPhones could become costlier worldwide compared with those made in Vietnam or China.

Also Read: India braces for export hit as US imposes steep new tariffs from Wednesday

What this could mean for iPhone prices

According to TOI reports, analysts warn that with negotiations stalling, the risk of a full 50 per cent tariff cannot be ignored. If applied to iPhones, the impact could reshape Apple’s pricing across key markets.

For now, Apple is likely to absorb any added costs rather than halt its expansion in India. In the US, where iPhones are mostly sold through telecom operators, a price rise would likely appear as a few extra dollars on monthly contracts instead of a steep upfront increase.

The tariff shield currently keeps iPhones safe, but the situation remains fluid. Section 232 powers have already been used to impose duties on steel and aluminium, affecting items as common as fishing reels and brooms. Experts caution that the same authority could be extended to smartphones.

For Apple, India is no longer just an alternative to China but the hub of its US-bound iPhone production. The company has momentum on its side, but its future gains depend on whether Washington keeps the door open or decides to close it with new tariffs.