Apple iPhone Manufacturing in Pakistan? Here’s What the New Report Really Says
Reports circulating in Pakistani media claimed that American tech giant Apple Inc. was set to begin manufacturing iPhones in Pakistan after the government agreed to offer incentives under a proposed Mobile and Electronics Manufacturing Framework.
However, the claim has turned out to be partially inaccurate.
While discussions are underway, Apple is not planning to manufacture brand-new iPhones in Islamabad. Instead, the proposed move involves setting up a refurbishment and repair facility for older iPhones, which would then be re-exported under the new policy framework.
What Did Apple Seek from the Shehbaz Sharif Government?
According to a report by The Express Tribune, Apple management requested three major conditions:
Land at discounted rates
An 8% performance incentive
Permission to repair two- to three-year-old iPhones
Engineering Development Board CEO Hamad Ali Mansoor reportedly stated that these demands have been incorporated into the proposed Mobile and Electronics Manufacturing Framework, which is awaiting approval from Prime Minister Shehbaz Sharif.
Mansoor added that Apple followed a similar model in countries like Indonesia, Malaysia, and India, where it initially established repair units to train local manpower before gradually expanding manufacturing operations.
Pakistan’s Strategy to Attract Global Tech Investors
Currently, Pakistan offers a 6% performance incentive to mobile phone manufacturers. The government is proposing to increase this to 8% to attract Apple and other global technology firms.
The initiative is reportedly backed by Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan and the Ministry of Industries.
Additionally, Pakistan is expecting approximately $557 million in investments from Chinese companies in mobile manufacturing. Memorandums of Understanding (MoUs) were signed during Prime Minister Shehbaz Sharif’s recent visit to Beijing.
The new framework is designed to:
Promote mobile phone localisation
Increase electronics exports
Attract foreign direct investment
Develop Pakistan as a regional electronics hub
Localisation Targets and Export Levy Plans
Currently, localisation in Pakistan’s mobile manufacturing stands at around 12%. The government aims to:
Increase localisation to 35% in the first year
Gradually raise it to 50% in later years
To fund technology upgrades and localisation efforts, the government plans to introduce an export levy of up to 6% under the new framework. Officials estimate the levy could generate approximately Rs 62 billion, which would be reinvested into strengthening domestic manufacturing capabilities.
However:
No export levy will apply to phones priced between PKR 50,000–60,000
The levy will target devices priced above PKR 100,000
Broader Electronics Push: Laptops, Tablets & E-Bikes
Beyond smartphones, the government expects the new policy to stimulate manufacturing of:
Laptops
Tablets
Smartwatches
Trackers
Wireless earbuds
In parallel, Pakistan is also promoting electric mobility. The government has allocated PKR 9 billion to provide a 40% subsidy on electric two-wheelers. To fund this initiative, up to 3% tax has been imposed on the gross sale value of conventional local and imported vehicles.
The Bottom Line
Apple is not setting up a full-scale iPhone manufacturing plant in Pakistan—at least not yet. The current proposal focuses on refurbishing older iPhones for re-export under a new government incentive framework.
If approved, the initiative could serve as a stepping stone toward larger electronics manufacturing investments in the future.
FAQ
Is Apple starting full iPhone manufacturing in Pakistan?
No. Apple Inc. is not planning to manufacture brand-new iPhones in Pakistan at this stage.
What is Apple planning to set up in Pakistan?
The proposal involves establishing a refurbishment and repair facility for older iPhones that would be repaired and re-exported.
Why did the initial reports cause confusion?
Some media reports suggested full-scale iPhone manufacturing. Later clarifications revealed the move would focus only on refurbishment, not new device production.
Which newspaper reported the development?
The information was reported by The Express Tribune.
What did Apple reportedly demand from the government?
Apple sought:
Discounted land
An 8% performance incentive
Approval to repair two- to three-year-old iPhones
Who is expected to approve the new framework?
The proposed policy awaits approval from Prime Minister Shehbaz Sharif.
What is the Mobile and Electronics Manufacturing Framework?
It is a proposed government policy aimed at boosting electronics production, exports, and foreign investment in Pakistan.
Has Apple used this model in other countries?
Yes. Apple reportedly adopted a similar approach in Indonesia, Malaysia, and India—starting with repair units before expanding operations.
What incentive does Pakistan currently offer manufacturers?
The government currently provides a 6% performance incentive to mobile manufacturers.
What change is being proposed to attract Apple?
Officials are considering increasing the incentive to 8%.
How much Chinese investment is expected in mobile manufacturing?
Pakistan expects around $557 million in investments from Chinese companies.
What are the government’s localisation goals?
Current localisation stands at about 12%. The targets are:
35% in the first year
50% in later years
What is the proposed export levy?
The government plans to impose up to a 6% export levy on certain mobile phones.
Which phones will face the export levy?
Phones priced above PKR 100,000 will be subject to the levy.
Which phones are exempt from the levy?
Devices priced between PKR 50,000–60,000 will not face any export levy.
How much revenue is expected from the export levy?
Officials estimate collections of around Rs 62 billion, which will be reinvested in technology upgrades.
What other electronics sectors are included in the policy?
The policy also targets manufacturing of:
Laptops
Tablets
Smartwatches
Trackers
Wireless earbuds
How does the government plan to support electric mobility?
The government has allocated PKR 9 billion to subsidize electric two-wheelers with a 40% subsidy.
How will the e-bike subsidy be funded?
Up to 3% tax has been imposed on conventional local and imported vehicles to fund the scheme.
What is the overall takeaway?
Apple is not setting up a full-scale iPhone manufacturing plant in Pakistan right now. The current proposal focuses on refurbishing older devices, which could potentially pave the way for future manufacturing expansion.
