This comprehensive article is covering assembled goods, economic metrics, manufacturing capacity development (distinguishing assembly from full manufacturing), key companies and partnerships, trade data, bilateral trends with the US and China, legal requirements for manufacturing classification in India and the US, policy changes, compliance by companies like Apple, strategies for managing norms across countries, DVA implications, actual manufacturing advancements, and PLI beneficiaries.
Assembled Goods In India: An Overview (2014-2025)
Assembled goods refer to products where key components are imported, often in Completely Knocked Down (CKD) or Semi-Knocked Down (SKD) form, and assembled locally, adding value through labor, testing, and packaging. This model is dominant in India’s smartphones, automobiles, and consumer electronics sectors. Under the Make in India initiative, launched in 2014, such activities qualify as manufacturing for GDP purposes if domestic value addition (DVA) meets policy thresholds, contributing to employment and exports. Even if DVA is not met, it is considered as manufacturing and becomes part of GDP, but benefits of various schemes may not be available.
India’s assembled goods sector includes smartphones, automobiles, and consumer electronics,etc. Electronics production expanded from approximately $23-31 billion in FY 2014-15 to $133-138 billion in FY 2024-25. Mobile phone production surged from about $2.3 billion to $51-66 billion over the same period. Key examples include smartphones assembled via CKD kits by companies like Apple and Samsung, automobiles with imported components by Maruti Suzuki and Hyundai, and electronics like TVs and appliances from LG and Whirlpool. Manufacturing’s share of GDP has remained in the 13-17% range during this period, showing stagnation rather than consistent growth.
Import reliance, particularly on China, remains high for components like smartphone displays, chips, and auto engines. Electronics imports from China increased from $60.41 billion in FY 2014-15 to approximately $113-127 billion in 2024. Around 70-85% of smartphone parts were imported in 2025. Policy measures, such as the Union Budget 2025-26 reducing duties on parts like PCBAs and camera modules to nil (from 2.5%), aim to enhance affordability.
DVA in assembled goods has grown modestly due to incentives and localisation policies, varying by sector. In electronics and smartphones, DVA started at low levels of about 2% in 2014 (primarily assembly) and reached 15-23% by 2024-25, incorporating assembly (10-20%), labor (5-10%), and software/testing (10-15%). In automobiles, DVA is often higher, exceeding 50% to qualify for incentives, supported by more established local supply chains. The Production Linked Incentive (PLI) scheme, launched in 2020 for electronics (4-6% incentives on incremental sales) and 2021 for automobiles (up to 13-18% based on sales value, requiring minimum 50% DVA), has driven this progress. Earlier, the Phased Manufacturing Programme (PMP) for mobiles in 2017 encouraged phased localisation.
Costs to vendor companies like Apple for assembled products in India include assembly fees paid to firms like Foxconn, ranging from $20-50 per iPhone unit, with total costs per unit (including components) at $400-600. India’s labor costs are lower at $1.40-3 per hour compared to $6-7.20 in China, but overall manufacturing costs in India are often 5-10% higher due to supply chain inefficiencies and infrastructure challenges. Assemblers typically earn 5-10% margins per unit. Foxconn’s India operations achieved revenues of about $20 billion in FY 2025, up from negligible levels in 2014, potentially yielding annual profits of $200-300 million at low net margins.
Evolution Of Key Assembled Goods (2014-2025)
The sector’s evolution reflects policy-driven localisation:
| Period | Key Products/Companies | DVA Range | Policy Drivers |
|---|---|---|---|
| 2014-2016 | Basic smartphones (Samsung, Micromax), auto components (Maruti Suzuki), simple electronics like TVs (LG) | 20-30% | Early Make in India |
| 2017-2019 | Advanced mobiles (Xiaomi, Oppo), cars (Hyundai), appliances (Whirlpool) | 30-40% | PMP (2017) |
| 2020-2022 | iPhones (e.g., 11/12 by Foxconn/Pegatron), EVs (Tata Motors), IT hardware (Dell) | 40-50% | PLI launch, COVID adaptations |
| 2023-2025 | High-end smartphones (iPhone 15/16 by Wistron/Tata), EVs (MG Motor), white goods (Samsung) | 50%+ (select sectors) | PLI incentives, Budget 2025-26 duty cuts |
Assembling Capacity Development In India (2014-2025)
PLI schemes, along with programs such as Electronics Manufacturing Clusters (EMC 2.0), have encouraged investments and production, though much of the activity in areas like electronics leans toward assembly rather than deep component manufacturing.
Foreign investments, including FDI, have contributed to this expansion, though net FDI inflows in 2025 remain low at under 1% of GDP, with sector-specific figures for electronics around $4 billion cumulatively since FY2020-21. Outward FDI from India hit historical highs in 2025, and foreign institutional investments are at their lowest levels, highlighting a complex investment landscape.
Overall, manufacturing’s share in GDP has slightly declined to around 13-16% by 2025. We will discuss this issue separately in greater detail to give a complete and authentic picture.
Actual Manufacturing Capacity Development (Excluding Assembly, 2014-2025)
The true “actual manufacturing”—defined as the full production of entire products using predominantly local raw materials, components, and processes, without relying on imported kits for assembly—remains limited in high-tech sectors like smartphones, electronics, and automobiles.
Much of the growth has been in assembly (e.g., CKD/SKD models), with self-reliance in core components (e.g., semiconductors, displays, engines) progressing slowly due to technological gaps and import dependencies (e.g., 80-90% of high-value electronics parts still imported from China as of 2025).
Overall, India’s electronics production value rose from ₹1.9 lakh crore in 2014-15 to ₹11.3 lakh crore in 2024-25, but only 20-30% of this represents full local manufacturing, with the rest being assembly.
Smartphones
In FY 2014-15, approximately 74-75% of smartphones in India were imported fully built, with domestic production only meeting 25-26% of demand. By FY 2024-25, this figure has dramatically shifted, with 99.2% of consumed mobile phones produced domestically, although this is primarily assembly rather than full manufacturing.
Despite this progress, challenges remain, particularly in high-value components. While basic components like printed circuit boards (PCBs) and casings have seen significant localisation, high-value items such as processors and displays are still largely imported, with 80-90% of these components coming from China. The localisation of cameras and displays stands at around 25%, indicating a continued dependence on imports for advanced technology. Overall, while India has made substantial strides in smartphone assembling, there is still a pressing need for improvement in high-value manufacturing capabilities.
Electronics
Electronics manufacturing has seen broader gains in full production for consumer items like LEDs, ACs, and IT hardware, but remains assembly-heavy for advanced goods. Full manufacturing is concentrated in sub-sectors like white goods.
Automobiles
From 2014 to 2025, the Indian automobile industry has seen a minor shift in the balance between assembling and manufacturing. In 2014, the localisation rate for many models was around 50-60%, indicating that approximately 40-50% of the vehicle components were assembled from imported parts. This meant that a substantial portion of the vehicles was assembled rather than fully manufactured in India.
By 2025, the industry aims to achieve a localisation rate of 70-80%. This translates to a reduction in the percentage of components that are merely assembled, with only 20-30% of parts expected to be imported.
Textiles
Despite its textile prowess, India imports final products like ready-made garments and home textiles from China, valued at $1.8-4.0 billion annually from 2014 to 2024. These imports, under HS codes 61-63, meet demand for affordable synthetics and designs, with China’s share at 40-42% of India’s total textile imports.
India’s trade with China has grown asymmetrically over the past decade, with imports dominating the narrative. The trade deficit ballooned from $46 billion in 2014 to over $112 billion in 2024, driven by India’s demand for value-added goods from China.
The cotton and textile sector exemplifies this dynamic, where India simultaneously imports raw cotton to bolster its domestic industry while exporting processed yarn to China, acting as a key processing hub in global supply chains. Recent policy shifts, such as India’s duty cuts on U.S. cotton imports, further highlight efforts to navigate trade tensions and enhance competitiveness.
India’s position as a “processing hub” involves importing specialised raw materials to enhance domestic output and exporting surplus value-added products. With over 50 million spindles, India processes 1-2 million imported bales annually into yarn, exporting $1.5-2 billion worth to China yearly—14% of its yarn exports—helping offset the trade deficit by 1-2%.
The imposition of 50% U.S. tariffs on Indian goods starting August 27, 2025—in retaliation to India’s 25% duties—threatens this resilience, particularly since the U.S. accounts for 33% of ready-made garment exports and India maintains a $45.7 billion trade surplus. These tariffs could lead to job losses, sub-5% growth in 2025-26, and market disruptions, exacerbated by India’s waiver of an 11% cotton import duty, which might depress local prices below the Rs 61,000 minimum support level, causing Rs 700 crore losses for the Cotton Corporation of India. The aligned partner exemptions could mitigate impacts for strategic allies and give them strategic advantage over Indian textile exports. Also, non-tariff barriers (NTBs) like the H-1B visa fee hike indirectly affect textiles by straining related services sectors, potentially reducing overall economic momentum.
Pharmaceuticals
India’s pharmaceutical industry has seen output roughly triple since 2014, expanding from a $20-30 billion market to $50-65 billion by FY 2023-24, driven by exports hitting $25 billion and PLI investments surpassing ₹38,543 crore by June 2025, positioning India as the third-largest volume producer supplying 20% of global generics.
However, the sector leans heavily toward assembling rather than full manufacturing, with 70% of active pharmaceutical ingredients (APIs) imported from China. India is only 20-30% self reliant in pharma manufacturing, as much activity involves assembling/formulation from imported raw materials rather than end-to-end production.
Recent developments undermines efforts of India to transition toward genuine manufacturing, including a noted US capacity increase in generics, which could compete with Indian exports, alongside strategic Indian acquisitions and key investments in the U.S. to enhance local production in U.S. and greater market access.
Domestic And International Challenges
India’s economic landscape in 2025 is marred by trade tensions, social disparities, and policy challenges, with GDP growth projections tempered by discrepancies in calculation methods—expenditure vs. production approaches—revealing debt traps and tariff turmoil, as explored in analyses of GDP discrepancies and economic trajectory. Persistent issues like poverty, hunger, inequality, and unemployment affect 28 million educated job-seekers and 100 million discouraged workers, with trade troubles exacerbating a 0.5-1% GDP dip amid U.S. policies, as detailed in discussions on trade troubles, workforce challenges, and economic conditions. International factors, including a $45.7 billion U.S. trade surplus under threat from 50% tariffs, highlight vulnerabilities in sectors reliant on assembling, while domestic social divides widen income disparities.
The $100,000 H-1B visa fee hike, effective September 21, 2025, intensifies NTBs, impacting outsourcing (potentially reducing India’s $138-250 billion revenue by 20-30%) and Indian talent (risking $10-20 billion remittance losses and 200,000+ job shifts), as outlined in visa impacts. This, combined with potential exemptions for aligned partners, could prompt India to pivot toward manufacturing self-reliance in textiles and pharma, diversifying trade away from U.S. dependency (60%+ in services) and addressing underemployment through reskilling, though AI automation threatens 40-50% of white-collar jobs. Overall, short-term and long-term disruptions could lead to sub-5% growth, urging a balanced approach to mitigate assembling risks and tariff/NTB pressures.
Companies Engaged In Assembly, Foreign Partners, Agreements, And Taxes
| Category | Companies Assembling in India | Foreign Partners | Legal/Commercial Agreements | Taxes Paid by Foreign Companies (Approx., 2014-2025) |
|---|---|---|---|---|
| Smartphones | Foxconn, Pegatron, Wistron, Dixon Technologies, Lava | Apple (US), Samsung (South Korea), Xiaomi (China) | PLI contracts (4-6% incentives on sales); Joint ventures (e.g., Foxconn-Apple assembly deal, 2016 onward); Tech transfer pacts requiring 30% local sourcing by 2025. Legal: FDI up to 100% automatic; IP protection under Indian Patents Act. Commercial: Royalty fees (1-5% of sales), supply chain agreements. | Corporate tax: 25-40% on profits (e.g., Apple paid ₹10,000+ crore cumulatively); Withholding tax: 10-20% on royalties/dividends; GST: 18% on assembled goods. Total: $5-10 billion across partners. |
| Automobiles | Tata Motors, Maruti Suzuki, Hyundai Motor India, MG Motor | Suzuki (Japan), Hyundai (South Korea), SAIC (China) | Licensing agreements (e.g., Maruti-Suzuki JV since 1981, updated 2020 for EVs); PLI for autos (₹25,938 crore scheme). Legal: FDI 100%; Environmental compliance under EPA. Commercial: Profit-sharing (50-50 in JVs), component import caps. | Corporate tax: 25-31.2% (e.g., Hyundai paid ₹15,000 crore+); Customs duties: 60-100% on imports (reduced for PLI); Total repatriated profits taxed at 15-20% withholding. Cumulative: $20-30 billion. |
| Electronics (TVs, Appliances) | Samsung Electronics India, LG Electronics India, Voltas (Tata), Godrej | Samsung/LG (South Korea), Whirlpool (US) | Contract manufacturing (e.g., Samsung’s Noida plant, 2018); PLI for ACs/IT hardware. Legal: SEZ benefits (tax holidays); Agreements under Companies Act 2013. Commercial: Export obligations (50% output), value addition targets (30-50%). | Corporate tax: 22-40%; Excise/GST: 18-28%; Total: $10-15 billion, with exemptions under SEZs reducing effective rate to 15%. |
Foreign companies comply with Indian tax laws: Resident entities pay 25% corporate tax (if income <₹400 crore), non-residents 40%. Repatriation after taxes (15% dividend withholding). No specific “assembly tax,” but profits from assembled goods are taxed as business income.
Table: Purely Manufactured Goods vs. Imported And Assembled Goods (2014-2025)
Purely manufactured goods use 100% local inputs, contrasting with imported/assembled ones relying on foreign components. Pure examples are niche, contributing <5% to GDP, while assembled dominate high-value sectors.
Purely manufactured goods with no foreign elements are rare due to global supply chains, but examples from 2014-2025 include khadi textiles (hand-spun cotton), handicrafts (e.g., pottery, woodwork from local materials), certain spices/herbs (e.g., turmeric from Indian farms), and traditional medicines (Ayurvedic herbs). These represent niche sectors like artisanal goods, contributing minimally to GDP but symbolising self-reliance.
| Year | Purely Manufactured Goods (Examples, Value in USD Bn) | Imported and Assembled Goods (Examples, Value in USD Bn) | Key Differences | Self-Sufficiency Trends |
|---|---|---|---|---|
| 2014-2015 | Khadi textiles, handicrafts, spices (e.g., turmeric), Ayurvedic medicines (~$10-15 Bn) | Smartphones (Samsung CKD), cars (Maruti imports), electronics (~$50-60 Bn imports, $20 Bn assembled) | Pure: 100% local raw materials/labor; Assembled: 20-30% value add on imports. | Low (20% for mobiles); Focus on artisanal self-reliance. |
| 2016-2019 | Handicrafts, pottery, traditional herbs (~$15-20 Bn) | Mobiles (Apple via Foxconn), autos (Hyundai), TVs (~$70-80 Bn imports, $30-40 Bn assembled) | Pure: Niche, export-oriented; Assembled: Growing via Make in India. | Rising to 40%; PLI precursors. |
| 2020-2022 | Spices, woodwork, local pharma generics (~$20-25 Bn) | EVs (Tata with imports), smartphones (Xiaomi), appliances (~$100 Bn imports, $50 Bn assembled) | Pure: Pandemic-resilient; Assembled: Supply chain disruptions. | 50%; COVID accelerated local sourcing. |
| 2023-2025 | Khadi, handicrafts, herbs, niche textiles (~$25-30 Bn) | iPhones (Foxconn), MG cars, LG TVs (~$120 Bn imports, $115 Bn production) | Pure: Symbolic of Atmanirbhar; Assembled: High-tech, export-focused. | 60-70%; PLI achieved 90% targets in some sub-sectors. |
Incorporating Trade Data: Imports, Exports, And Bilateral Trends
India’s merchandise imports from April to September 2025 (first half of FY 2025-26) are estimated based on available data up to August 2025, as September figures were not yet released by September 21, 2025. Cumulative imports for April-August 2025 stood at approximately $310 billion, showing a moderate increase compared to previous periods. Major imported goods included petroleum crude, electronics, machinery, gold, and organic chemicals. For comparison, in FY 2023-24 (April 2023-March 2024), total imports were around $675 billion, and in FY 2024-25 (April 2024-March 2025), they reached about $680 billion. The April-September 2025 period reflects a 5-7% year-on-year growth from the same period in 2024, driven by rising energy demands and industrial inputs, though moderated by global price fluctuations.
| Period | Total Imports (USD Billion) | Major Goods | Percentage Change (YoY) | Comments |
|---|---|---|---|---|
| April-Sept 2025 (est. up to Aug) | ~310 | Petroleum (~30%), Electronics (~15%), Machinery (~10%), Gold (~8%), Chemicals (~7%) | +6% from April-Sept 2024 | Growth led by energy imports amid stable oil prices; electronics surge due to domestic manufacturing needs. |
| FY 2023-24 | 675 | Petroleum (34%), Electronics (12%), Machinery (10%), Gold (8%), Chemicals (6%) | +2% from FY 2022-23 | Steady recovery post-COVID, with oil dominating due to global supply issues. |
| FY 2024-25 | 680 | Similar to above, with slight increase in electronics | +0.7% from FY 2023-24 | Marginal growth amid tariff uncertainties and domestic push for self-reliance. |
India’s merchandise exports from April to September 2025 totaled around $215 billion (up to August data), with major goods including petroleum products, engineering goods, pharmaceuticals, gems/jewelry, and textiles. Compared to FY 2023-24 ($437 billion) and FY 2024-25 (~$440 billion), the half-year figure shows a 3-5% growth YoY.
| Period | Total Exports (USD Billion) | Major Goods | Percentage Change (YoY) | Comments |
|---|---|---|---|---|
| April-Sept 2025 (est. up to Aug) | ~215 | Petroleum products (~15%), Engineering (~14%), Pharma (~12%), Gems (~10%), Textiles (~8%) | +4% from April-Sept 2024 | Boost from pharma and engineering amid global demand; impacted by late-August US tariffs. |
| FY 2023-24 | 437 | Similar, with pharma leading growth | +3% from FY 2022-23 | Post-pandemic rebound in services-integrated exports. |
| FY 2024-25 | 440 | Engineering and petro products dominant | +0.7% from FY 2023-24 | Marginal gains despite supply chain disruptions. |
Several goods were imported and then re-exported, notably crude oil (imported and refined into petroleum products for export) and rough diamonds (imported, cut/polished, and re-exported as jewelry). These accounted for ~20% of total exports in the period.
From April to August 2025, India’s imports from the US were approximately $15-20 billion, mainly aircraft parts, machinery, and electronics. Exports to the US reached ~$35-40 billion, dominated by pharmaceuticals, gems, textiles, and IT-related goods. The US imposed a 50% tariff on Indian goods effective August 27, 2025, targeting India’s purchases of Russian oil and weapons, with exemptions for “aligned partners” (e.g., USMCA-qualified goods, but not directly for India). Post-imposition, exports to the US dipped in late August, with a 14% monthly decline from July to August. This led to warnings of job losses and slower growth, potentially affecting $48 billion in annual exports.
| Metric | Total April-Aug 2025 (USD Billion) | Before Tariffs (April-Aug 26) % of Total | After Tariffs (Aug 27-Onward) % of Total | Comments |
|---|---|---|---|---|
| Imports from US | ~18 | 99% (pre-Aug 27) | 1% (post-Aug 27, minimal impact on imports) | Tariffs mainly on Indian exports; imports stable. |
| Exports to US | ~38 | 95% (pre-Aug 27) | 5% (post-Aug 27, early dip observed) | Sharp fall expected in pharma and textiles due to tariffs. |
India’s major imported goods from 2014 to 2025 included petroleum, electronics, machinery, gold, and chemicals. Total imports grew from $459 billion in 2014 to ~$700 billion in 2025 (projected).
| Year | Total Imports (USD Billion) | % Change YoY | Reasons |
|---|---|---|---|
| 2014 | 459 | – | Base year; high oil prices. |
| 2015 | 390 | -15% | Falling oil prices, global slowdown. |
| 2016 | 357 | -8% | Continued oil dip, rupee depreciation. |
| 2017 | 466 | +30% | Economic recovery, higher energy demand. |
| 2018 | 514 | +10% | Industrial growth, import dependency. |
| 2019 | 474 | -8% | Trade tensions, COVID early effects. |
| 2020 | 389 | -18% | Pandemic lockdowns reduced demand. |
| 2021 | 611 | +57% | Post-COVID rebound, supply chain restocking. |
| 2022 | 760 | +24% | Energy price surge, Ukraine war. |
| 2023 | 779 | +2% | Stabilizing global markets. |
| 2024 | 800 (est.) | +3% | Manufacturing push, electronics imports. |
| 2025 (proj.) | 700 | -12% | Tariff impacts, self-reliance initiatives. |
Major exported goods: petroleum products, pharma, engineering, gems, textiles. Exports rose from $318 billion in 2014 to ~$450 billion in 2025.
| Year | Total Exports (USD Billion) | % Change YoY | Reasons |
|---|---|---|---|
| 2014 | 318 | – | Base; strong pharma/textiles. |
| 2015 | 262 | -18% | Global demand fall, oil price crash. |
| 2016 | 276 | +5% | Recovery in services exports. |
| 2017 | 303 | +10% | GST implementation boost. |
| 2018 | 331 | +9% | Engineering goods surge. |
| 2019 | 313 | -5% | Trade wars. |
| 2020 | 291 | -7% | COVID disruptions. |
| 2021 | 422 | +45% | Rebound, vaccine exports. |
| 2022 | 453 | +7% | Petro products boom. |
| 2023 | 451 | -0.4% | Global slowdown. |
| 2024 | 437 | -3% | Supply issues. |
| 2025 (proj.) | 450 | +3% | Diversification efforts. |
India-China trade from 2014-2025 saw imports from China rise from $58 billion to $127 billion, exports to China from $12 billion to $15 billion (2024), with a growing deficit. Major imports: electronics, machinery, chemicals; exports: iron ore, cotton, seafood.
| Year | Imports from China (USD Bn) | % Change | Exports to China (USD Bn) | % Change |
|---|---|---|---|---|
| 2014 | 58 | – | 12 | – |
| 2015 | 71 | +22% | 12 | 0% |
| 2016 | 61 | -14% | 9 | -25% |
| 2017 | 76 | +25% | 13 | +44% |
| 2018 | 70 | -8% | 17 | +31% |
| 2019 | 65 | -7% | 17 | 0% |
| 2020 | 65 | 0% | 21 | +24% |
| 2021 | 97 | +49% | 21 | 0% |
| 2022 | 102 | +5% | 14 | -33% |
| 2023 | 99 | -3% | 16 | +14% |
| 2024 | 127 | +28% | 15 | -6% |
| 2025 (up to Sept) | ~75 | +15% (proj.) | ~10 | +10% (proj.) |
Imported goods from China were used in various sectors: Machinery (e.g., industrial equipment) in manufacturing and infrastructure (e.g., solar panels, textiles machinery); electronics in consumer goods and assembly (e.g., components for mobiles); chemicals in pharma and agriculture.
India’s Requirements For Assembly To Qualify As Manufacturing
In India, there is no single fixed percentage that defines when assembly qualifies as “manufacturing” under general law (e.g., the Factories Act, 1948, considers assembly as manufacturing if it involves transformation of goods).
However, for incentives, tax benefits, and classification under schemes like Make in India or PLI, the key metric is Domestic Value Addition (DVA). DVA measures the percentage of a product’s value created domestically through labor, components, and processes, excluding imported parts.
Under PLI schemes (introduced in 2020 and expanded), minimum DVA requirements vary by sector and increase over time to promote self-reliance:
(a) For automobiles and advanced automotive technology (AAT) products: Minimum 50% DVA required for eligibility, certified by testing agencies.
(b) For electric vehicles (EVs): Starts at 25% by year 3, rising to 50% by year 5.
(c) For electronics (e.g., mobiles under Phased Manufacturing Programme or PMP, linked to PLI): Begins at 15-20% in early years, targeting 35-40% by 2025-26, with some sub-sectors aiming for 60% within 5 years (e.g., advanced chemistry cells for batteries).
(d) For white goods (e.g., ACs, LEDs): Incentives of 4-6% on incremental sales, but qualification often requires 20-30% initial DVA, rising to 50%.
(e) General procurement preference (e.g., for government contracts): Class-I local suppliers need at least 50% DVA.
If DVA is below these thresholds, the activity will still count as manufacturing for GDP purposes but not qualify for “manufacturing” benefits under PLI or Make in India, such as incentives (4-6% of sales), tax holidays, or export credits. Overall, electronics value addition has risen from 30% in 2014 to 70% by 2025, with targets of 90% by FY27.
US Requirements For Assembly/Production To Qualify As Manufacturing
In the US, there is no fixed percentage for assembly to qualify as “manufacturing” broadly (e.g., under Census Bureau definitions, assembly counts if it adds value). However, for “Made in USA” labeling (regulated by the Federal Trade Commission or FTC), products must be “all or virtually all” made in the US, meaning final assembly, significant processing, and negligible foreign content (typically no more than 5-10% foreign value). This is not a strict percentage but a holistic “substantial transformation” test by US Customs and Border Protection (CBP) for origin rules. For government procurement (Buy America), manufactured products must have final assembly in the US and 55-60% domestic content (per 2025 updates).
Qualified claims (e.g., “Assembled in USA”) allow disclosure of foreign parts, but “Made in USA” requires de minimis foreign input (e.g., <5% wholesale value).
Goods Assembled In The US (2014-2025), Especially With Indian Components
US assembly focuses on high-value sectors like autos, electronics, and machinery. Indian components (e.g., auto parts, electronics) are imported ($91B total US imports from India in 2024), but specific assembly examples are limited as India exports more finished goods or raw materials. Key categories include vehicles with Indian steel/parts and electronics with Indian semiconductors/software.
| Year Range | Key Assembled Goods | Examples with Indian Components | Estimated Domestic Content | Notes on Qualification |
|---|---|---|---|---|
| 2014-2016 | Autos (e.g., Ford models), electronics (computers), aircraft parts | Auto parts (e.g., Indian steel in GM vehicles), IT hardware with Indian chips | 70-90% (negligible Indian <5%) | Pre-2021 FTC rule; focused on substantial transformation. Qualified as Made in USA if foreign <10%. |
| 2017-2019 | EVs (Tesla models), machinery, consumer goods | Electronics with Indian semiconductors (e.g., Qualcomm devices), textiles in apparel assembly | 80-95% | Trade tensions; Indian imports rose (e.g., machinery parts), but assembly in US to meet Buy America. |
| 2020-2022 | Smartphones/laptops (partial US assembly), vehicles (e.g., Rivian EVs) | Pharma equipment with Indian generics/parts, auto components (e.g., Tata-owned Jaguar parts) | 85-95% | COVID supply shifts; minimal Indian content to qualify for Made in USA. |
| 2023-2025 | Semiconductors (Intel fabs), EVs (Ford Mustang Mach-E), machinery | Indian auto parts in US EVs (e.g., batteries with Indian lithium processing), electronics with Indian software/hardware | 90%+ (foreign <5%) | Post-2021 FTC penalties; Indian imports (e.g., $38B exports to US in April-Aug 2025) used sparingly to avoid violations. |
Consequences If Minimum Domestic Content Is Not Maintained In The US
Violations of FTC’s Made in USA rule lead to civil penalties (up to $51,744 per violation), injunctions, disgorgement of profits, and consumer lawsuits. For Buy America (infrastructure), non-compliance results in contract denial, debarment, or fund clawbacks. CBP may impose duties or seizures for origin mislabeling.
Examples from 2014-2025:
(a) 2014-2020 (Pre-rule era): Companies like a tool manufacturer (unnamed in FTC cases) with >30% foreign content faced warnings and label changes, but no penalties. Consequences: Market backlash, e.g., lost government contracts.
(b) 2021-2023: After 2021 FTC rule, a company paid $3.175M (largest ever) for false Made in USA claims on products with significant foreign parts. Another faced $1M+ in penalties for misleading labels.
(c) 2024-2025: FTC warned Amazon/Walmart on third-party sellers’ false claims (e.g., products with >10% foreign content labeled Made in USA). A surge in class-action lawsuits (e.g., seeking damages for deceptive advertising) led to restitution and injunctions. In 2025, a case involved electronics with Indian parts exceeding 5% foreign threshold, resulting in $500K+ penalties and label recalls.
Apple And Other Companies Assembling In India: Compliance And Potential Violations
Apple (via Foxconn, Pegatron, Wistron/Tata) and others (e.g., Samsung, Xiaomi) assembling in India generally comply with PLI DVA norms. By 2025, Apple’s suppliers achieved 20%+ DVA across iPhone models (up from 5-8% in 2020), exceeding production targets but lagging on value addition goals (e.g., 21% vs. 35-40% by 2023). This qualifies them for partial incentives (4-6%), with exports hitting $22.56B in H1 2025. Samsung and others reached 50-70% DVA in electronics.
Potential violations: No major DVA breaches reported for Apple, but lags led to incentive delays. Other issues include labor violations (not directly DVA-related):
(a) Apple: 2020 Wistron riots over wage underpayment; 2024 Foxconn discrimination against married women, risking probation under Apple’s code (could lead to contract loss).
(b) Others: Some PLI participants (unnamed) missed value addition, forfeiting incentives; e.g., 2024 reports of suppliers reaching volume but not DVA, facing audits.
Managing Domestic Manufacturing Norms: Apple And Other Multinationals In India And The US
Multinational companies like Apple, Samsung, and Google navigate the contrasting domestic manufacturing norms in India and the US by adopting diversified supply chain strategies. These include partial localisation, component-focused investments, and leveraging government incentives to meet varying thresholds for Domestic Value Addition (DVA) or domestic content.
India’s norms are more flexible, with DVA requirements starting at 15-20% and scaling to 50-70% under schemes like the Production-Linked Incentive (PLI), allowing assembly with imported parts to qualify as “manufacturing” for benefits.
In contrast, the US has stringent standards: the Federal Trade Commission (FTC) requires “all or virtually all” domestic content (typically <5-10% foreign value) for “Made in USA” labeling, while Buy America provisions for government procurement demand 55-60% US content and final assembly in the US as of 2025 updates. Given the high US threshold, companies rarely claim full “Made in USA” for complex electronics like smartphones, opting instead for qualified labels (e.g., “Assembled in USA with foreign parts”) or focusing on US production of high-value components.
This disparity poses challenges for global supply chains, where products like iPhones involve thousands of parts from multiple countries. Companies manage it through “friendshoring” (shifting to allied nations like India), tariff avoidance, and phased compliance. For instance, amid US tariffs on Chinese goods (escalating in 2025), firms increasingly assemble in India for export to the US, meeting India’s lower DVA while incorporating US-made components to partially align with American preferences.
Below are details on how Apple and others (e.g., Samsung, Google/Motorola) handle this, drawing on their strategies as of September 21, 2025.
Apple’s Approach
Apple does not fully manufacture iPhones or other devices in the US due to the high domestic content threshold, which would require near-total US sourcing—an impractical feat for globalized electronics reliant on Asian semiconductors and rare earths. Instead, Apple focuses on US investments in components and R&D, while scaling assembly in India to diversify from China and leverage PLI incentives. This allows compliance with India’s norms (achieving 20-70% DVA) without needing to meet US “Made in USA” standards for the final product.
Apple commits $600 billion over four years (announced August 2025) to US suppliers, focusing on components rather than full devices. This includes producing 19 billion chips in 2025 via TSMC’s Arizona fab and 100% of iPhone/Apple Watch cover glass in Kentucky with Corning. Through the “American Manufacturing Program,” Apple incentivises suppliers to relocate to the US, creating a resilient supply chain without full device assembly. This avoids FTC penalties for misleading labels (Apple uses “Designed in California, Assembled in [India/China]”) and aligns with Buy America for eligible products (e.g., components in government tech). CEO Tim Cook’s White House engagements helped defer forced full US iPhone production amid tariff threats.
Samsung’s Approach
Samsung, a major Android player, mirrors Apple’s strategy but faces unique hurdles like the PLI scheme’s expiration for smartphones in FY26 Q1, leading to recalibrations.
Samsung achieves PLI compliance in India with DVA around 30-50%, exporting 945,000 units to the US in Jan-May 2025 (up from prior years). However, exports fell 20% in FY26 Q1 post-PLI benefits, prompting cost hikes (10-15% on smartphones) and supply shifts.
Samsung invests in US facilities (e.g., Texas semiconductor fab) for chips, meeting Buy America for components but not full devices. No widespread “Made in USA” claims for phones. Similar to Apple, Samsung uses India as a hub for US exports, incorporating US tech transfers to boost partial domestic content. This addresses the high US threshold by avoiding full claims and focusing on incentives in India.
Major Beneficiaries Of The PLI Scheme (Inception To September 2025)
In mobile phones, nearly US$1 billion was disbursed from 2022-25 to 19 firms. Major beneficiaries include Foxconn (leading in electronics with ~20-25% share), Samsung, and Tata Electronics, collectively holding 40-50% of total disbursements. The table below summarises key beneficiaries by sector/share (percentages approximate based on reported disbursements and sector allocations up to mid-2025; total adds to 100%).
| Beneficiary/Sector | Key Companies | Approximate Share of Total Disbursements (%) | Notes |
|---|---|---|---|
| Electronics (Mobile/IT Hardware) | Foxconn, Samsung, Pegatron, Tata Electronics, Dixon Technologies | 40-45% | Dominates with ~INR 90-100 Bn; Foxconn/Tata/Pegatron alone ~US$1 Bn for mobiles. |
| Pharmaceuticals | Sun Pharma, Dr. Reddy’s, Cipla, others | 25-30% | ~INR 50-60 Bn; focus on APIs and formulations. |
| Automobiles/Auto Components | Tata Motors, Hyundai, Mahindra | 10-15% | ~INR 20-30 Bn; EV batteries key area. |
| White Goods/ACs/LEDs | LG, Daikin, Voltas, others | 5-10% | ~INR 10-20 Bn; reopened applications in Sept 2025. |
| Other Sectors (Textiles, Steel, MSMEs across) | Various MSMEs (70+ direct) | 10-15% | ~INR 20-30 Bn; broad distribution. |
In conclusion, India’s 2014-2025 journey marks a core focus upon assembling than pure manufacturing and self sufficiency. India’s cheap labour is the main reason why we have assembling hubs in India. But that cheap wage is also the reason why we have mass scale poverty and hunger in India. In the name of Make in India, we are just doing assembling in India and importing almost all of our good for domestic consumption from China. We are super dependent upon China and US and this is the bitter truth that must be accepted by all instead of lies and jumlabaazi of Swadeshi and Atmanirbhar Bharat.