CNBC's Inside India newsletter: Apple has big expansion plans in India — but Trump's tariffs could change that

This report is from this week's CNBC's "Inside India" newsletter which brings you timely, insightful news and market commentary on the emerging powerhouse and the big businesses behind its meteoric rise. Like what you see? You can subscribe  here.

The general consensus was that U.S. President Donald Trump and Indian Prime Minister Narendra Modi had a successful meeting in Washington last month. What went wrong — and why is Apple caught in the middle?

To get everyone up to speed — trade talks seem to be breaking down between the two countries ahead of the April 2 deadline when Trump's reciprocal tariffs on India are set to go into effect.

Trump has long criticized India for its high tariffs, among the highest in Asia. Analysis from Barclays shows that the weighted average of India's tariffs on all imports is 11.5%. Another key concern for Washington is the widening U.S.-India trade deficit.

Last week, India's Commerce Minister Piyush Goyal went to Washington to present further concessions, including slashing tariffs on key U.S. imports in the hopes that, in exchange, India would be granted an exemption from Washington's reciprocal tariffs. However, Trump's trade team doesn't seem to be budging, per sources close to New Delhi. That's raising alarm bells.

The technology industry stands to lose — particularly Apple which manufactures roughly 15% of its iPhones in India, according to Bank of America analyst estimates.

Finished smartphones entering India currently face a 16%-20% tariff, whereas tariffs on Indian phones sold into the U.S. are at 0%, according to Barclays.

"If the Indian exports of smartphones, which have picked up recently — were to face similar tariffs in the U.S., it could deal an early life-cycle blow to the