Union Budget 2026: India Offers Five-Year Tax Relief To Apple And Other Foreign Firms Supplying Manufacturing Equipment

Union Budget 2026: The Government of India has unveiled a significant new policy to promote electronics manufacturing in the country. Foreign companies such as Apple can bring their machinery to the India plant without risking a tax claim under the new policy, Finance Minister Nirmala Sitharaman announces. The offer is intended to spur multinational companies to move production to India and lessen their reliance on China. It also dovetails with India’s long-term goal of becoming a global hub for electronics manufacturing.

Tax Relief for Foreign-Owned Machinery

Under the new initiative, foreign companies can provide machines to local contract manufacturers without being taxed on ownership of that equipment. The exemption will apply for five years and will remain valid until the 2030–31 tax year, but only for factories set up in designated customs-bonded zones.

ALSO READ: YouTube Blocks Free Background Playback On Mobile Browsers, Pushing Users Toward Premium

Revenue Secretary Arvind Shrivastava said the goal is to provide certainty to companies investing in Indian manufacturing by ensuring that simply owning machines does not trigger tax liability.

Apple’s Role and Manufacturing Shift

Apple has been steadily expanding its manufacturing footprint in India to diversify production away from China. According to Counterpoint Research:

- iPhone market share in India has doubled to 8% since 2022

- India’s share of global iPhone production has risen to 25%

- China still accounts for around 75% of global shipments

Apple’s Lobbying and Tax Concerns

Apple had lobbied Indian officials to amend its rules around taxes, worried that selling machinery to partners like Foxconn and Tata would be treated as a business transaction and could cause the iPhone’s profits to be taxed, according to Reuters. This worry used to mean the contract manufacturers had to spend billions on equipment themselves.

ALSO READ: Android 16 Reaches 7.5% Adoption As Google Updates Distribution Data

Strategic Impact on Electronics Manufacturing

The policy does not affect Samsung, which manufactures most of its phones in its own Indian factories.