Apple said in a statement that it has started assembling its low-priced iPhone SE at the plant of its contract manufacturer in the technology hub of Bengaluru in southern India. According to The Wall Street Journal, the first iPhone SE devices assembled in India could hit stores as soon as this month.

Apple starts initial production in India

In a statement to the Wall Street Journal, the smartphone maker said it is “beginning initial production of a small number of iPhone SE in Bengaluru and will begin shipping the Indian-made devices to domestic customers this month.”

In February, Reuters reported that Wistron, Apple’s Taiwan-based manufacturing partner, will assemble the iPhone SE in India by the end of April or early May, and earlier this year, there were reports that Wistron had applied for permission to expand its facility in Bengaluru. The Taiwan-based contract manufacturer requested that its application be fast-tracked as well.

Wistron has completed the trial run of assembling iPhones in India at its manufacturing facility, notes Digit. A spokeswoman for the Taiwanese company, however, said that they don’t comment on “market rumors or speculation.”

Rising competition in China

Assembling phones in India is seen as an important move for the U.S. firm to sell more phones in the country. Apple is looking to increase its market share in one of the fastest growing mobile phone markets in the world as it continues to face fierce competition in China. The tech giant has been facing tremendous competition in China from local players who build inexpensive but good quality phones.

Owing to such factors, the U.S. firm reported a 14% sales decline in its fiscal second quarter in Greater China, where it faces competitors like Oppo, Vivo, Xiaomi and Lenovo. With decreasing sales in the largest smartphone market in the world, the U.S. company is trying to expand into other growing markets worldwide, with India being its primary target.

Currently, Apple accounts for only 3% smartphone sales in the country, compared to 27% for Samsung and 12% each for Xiaomi and Vivo, according to research firm Kantar. The U.S. firm sold 2.7 million phones in India last year.

How much will the iPhone SE cost now?

We are still not certain how much the iPhone SE will cost after being locally assembled, but government officials are expecting the price to drop by at least $100, notes Digit. Currently, the iPhone SE is priced at Rs37,200 (about $600) for the 128GB version and Rs27,200 (about $440) for the 32GB version. The 4-inch phone comes with a 12-megapixel camera and is powered by the A9 chip, which is used in the iPhone 6S.

It must be noted that the tech giant recently slashed the price of the iPhone 5s and iPhone SE in the country. Whether or not the price of the low-cost iPhone will come down further due to local assembly is not certain. Since Apple is known for consistent pricing across all markets worldwide and maintaining control over gross margins, we are not expecting anything just yet.