Apple supplier Foxconn is set to start manufacturing iPhones in the southern Indian state of Karnataka by April 2024, according to the state government. The project, which is valued at Rs. 130 billion, is expected to create around 50,000 jobs.
Details of the Project
Foxconn, which is the world’s largest contract electronics manufacturer, has set a target of producing 20 million iPhones a year at the plant in Devanahalli, on the outskirts of the state capital and tech hub Bengaluru. The land for the factory will be handed over to Foxconn by July 1, 2021.
The move is part of Apple’s strategy to shift production away from China, after the country’s COVID-related restrictions disrupted the production of new iPhones and other devices. The tech giant is also looking to avoid a hit to its business due to tensions between Beijing and Washington.
Response from Foxconn
A spokesperson for Foxconn did not immediately respond to a request for comment from Reuters. However, the company has been expanding its manufacturing operations in India in recent years. In 2019, it started assembling the iPhone XR at a plant in Chennai, and it has also been manufacturing devices for other companies, such as Xiaomi and Nokia.
Modified Semicon India Programme
Meanwhile, some applicants, including Vedanta Foxconn JV, are expected to re-apply for government incentives under the modified semiconductor scheme opening from June 1, according to sources. Under the new scheme, the government has increased the financial incentive of 50 percent of the project cost for companies, consortia, and joint ventures for setting up semiconductor fabs in India of any node (wafer size).
In the old scheme, the incentives varied based on the wafer node size. Similarly, a fiscal incentive of 50 percent of the project cost is available for setting up of display fabs of specified technologies in India, a statement said on Wednesday.
With this move, Apple is expanding its manufacturing operations in India, which is one of the world’s fastest-growing smartphone markets. The company already has a significant presence in the country, with over 1 million employees in its supply chain. By manufacturing devices locally, Apple can save on import duties, and it can also tap into the country’s large pool of tech talent. The move also supports the Indian government’s efforts to boost local manufacturing and reduce its reliance on imports.
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