Apple cuts iPhone prices in this market for the first time

For the first time, Apple has been able to cut the prices of current iPhone models in India, the world's second-largest smartphone market behind China and ahead of the U.S. But it did take a drop in Indian import duties on smartphones shipped into the country from 20% to 15% to bring on the price cuts ranging from from 3% to 4%. 

The change in India's budget was put into place on July 23rd and led Apple to cut iPhone prices starting with a 300 rupees ($3.60) drop on models like the made-in-India iPhone 13, iPhone 14, and iPhone 15. As those units were built in India, they were not affected by the cut in import duties. The price of the iPhone SE 3 was sliced by 2,300 rupees ($27.50).

Current premium iPhone 15 models such as the iPhone 15 Pro and iPhone 15 Pro Max received a more generous price cut of as much as 6,000 rupees ($71.70). While India is indeed the world's second-largest market for smartphones, it also is a developing country. Per Glassdoor, the average monthly salary in the country ranges from 8,000 rupees ($95.55) to 143,000 rupees ($1,708.02) which explains why value-for-money firm Xiaomi sells very well in India. It also explains why Android holds a whopping 95.03% share of smartphone sales in the country.

Even after the price cut, iPhone models are very expensive in India. For example, the iPhone 15 Pro, the lowest-priced iPhone model that will receive Apple Intelligence later this year, is priced in the U.S. at $990. In India, the very same phone will cost $1,550 or 55% more. 

Apple appears to be concerned about the direction of iPhone sales in Asia in light of recent data showing that Apple dropped out of the top five smartphone brands shipped in China during the second quarter. The tech giant might be hoping that cutting iPhone pricing in India can help generate more sales on the continent.

While Apple has been building iPhones in India for years now, the original plan was to bypass India's import tax on smartphones shipped into the country. Originally, Apple had older models made in the country but last year some iPhone 15 and iPhone 15 Plus units were built in India. And now the company is considering assembling iPads in India at Foxconn's facility in Tamil Nadu. Foxconn has already had discussions with the Indian government about building tablets in the country.

While we haven't heard much lately about Apple's plan to diversify production out of China, moving some iPad production to India means that Apple is feeling more confident in the supply chain it has built in the area, and moving out of China is possibly still a long term goal for Apple.