This story was first published on the Benzinga India portal.

Apple Inc. (NASDAQ:AAPL) is reportedly in discussions with Micron, Tata Group and other Indian chip manufacturers to procure semiconductors for its locally-produced iPhones.

What Happened: Apple's demand for semiconductors is projected to reach $12 billion by 2026, according to a report by Financial Express. By this time, the tech giant plans to shift 26% of its global iPhone production to India.

If Micron and Tata Group's units, expected to be functional by then, can produce the required grades, they could secure substantial business from the world's largest company.

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Apple's spending on Indian-made microchips is likely to exceed that of any other single company in the defense, aviation and auto sectors. In FY24, Apple manufactured iPhones worth $14 billion in India, which accounted for nearly 14% of its global iPhone production.

Apple's global semiconductor consumption has surged over threefold from $18.8 billion in 2011 to around $72 billion currently. The company initiated the production of iPhones in India under the smartphone production-linked incentive scheme through its three Taiwanese vendors in 2021.

The Indian government launched a $10 billion incentive scheme in 2022 to stimulate domestic semiconductor production. To date, five chip projects worth around $18 billion have been approved under this scheme, leaving about $1.2 billion for future projects.

Disclaimer: Artificial intelligence was used as a secondary aid in the writing of this story.