India: why low cost was never the argument

Published in Site Selection Magazine | By Akanksh Chandra Shekar, Senior Research Analyst, Tractus India

India manufacturing costs are usually argued on wages. Reuters reported in April 2025 that Apple’s iPhone costs in India ran 5% to 8% above China, and 10% on some models, largely because components arrive as dutiable imports. Apple has the deepest incentives and the most experienced contract partners of any foreign manufacturer in the country.

In his latest piece for Site Selection Magazine, Tractus India senior research analyst Akanksh Chandra Shekar argues that India is low cost in exactly one line item, wage, and that direct labor is a modest share of delivered cost in most engineered products.