Apple has significantly ramped up its efforts to curb unauthorized exports of iPhones from India, severing ties with multiple distributors and implementing stricter compliance regulations across its retail network.
The move comes in response to a growing trend of grey-market shipments, where iPhones bought in India are unofficially exported to countries such as Russia, various African nations, and parts of West Asia. Industry executives indicate that India's relatively competitive pricing makes it an attractive sourcing hub for traders seeking higher profit margins in overseas markets.
Distributor Terminations and Enhanced Retail Checks
Sources confirm that Apple has already terminated several distributors in key regions including Punjab, Mumbai, Haryana, and parts of southern India, with additional partners currently under review. Simultaneously, new instructions have been issued to retailers, mandating more stringent in-store activation procedures to prevent device diversion.
Under the revised protocol, all devices must be unsealed, activated with a local SIM card, and fully set up at the store before being handed over to customers. This means buyers will no longer receive iPhones in sealed packaging at the point of sale. Retailers face immediate penalties, including suspension from future business, for any violations.
New Billing Rules and Partner Strategy
Further compliance measures include new billing practices. iPhone and iPad sales will now be invoiced at the Maximum Retail Price (MRP). Retailer margins will subsequently be released through credit notes, following verification based on activation data. Settlements will occur weekly, accompanied by reconciliation reports.
These actions build upon an earlier initiative launched in November, which discouraged the use of foreign SIM cards for activating newly purchased iPhones, particularly newer models, amidst reports of supply shortages linked to bulk diversions. Government data for the first 11 months of FY26 revealed that iPhones constituted over 75% of India’s smartphone exports, contributing approximately ₹2 trillion out of total shipments around ₹2.6 trillion. Industry estimates suggest that 5-7% of these exports may traverse unofficial channels.
Alongside tighter controls, Apple is also reportedly favoring larger retail partners, reducing engagement with smaller retailers, and shortening premium partner contracts from three years to roughly one year.