Foxconn to invest $1bn in India

Joanna Estrada
July 13, 2020

After speaking to people familiar with Apple and Foxconn's plans, Reuters has learned that the Taiwanese contractor is planning to invest up to $1 billion to expand its factory located in Sriperumbudur, near Chennai. It also operates a individual plant in the southern Indian state of Andhra Pradesh, in which it will make smartphones for China's Xiaomi Corp, amid other folks.

Foxconn Chairman Liu Young-way told the company's annual general meeting last month that looking ahead, "India was a bright spot" for development even though there was a "certain impact" at present due to the COVID-19 pandemic. "We'll have a further investment there".

While Foxconn assembles the iPhone in China for Apple, the contract manufacturer also puts some models together in India. By making more phones in India, Apple will avoid paying import duty.

The expansion of the plant will take about three years and generate about 6,000 jobs, according to another source.

Only 1% of smartphone sales in India are for the iPhone, as its high cost makes it a status symbol in the world's second-largest smartphone market. Not only are the older models cheaper, producing them in the country will save consumers from having to pay the import tax.

The manufacturer of Apple's iphone is Foxconn.

"With India's labour more affordable compared with China, and the gradual expansion of its provider base listed here, Apple will be in a position to use the region as an export hub", stated Neil Shah of Hong Kong-dependent tech researcher Counterpoint.

India to Become the Next Electronic Hub?

Apple's production shift is in line with an Indian government plan, launched last month, to offer incentives to global smartphone markers in exchange for promises of establish or expand production in the South Asian country.

Acquiring Apple widen its local existence is probably to be a increase for Primary Minister Narendra Modi's flagship "Make In India" drive, aimed at generating new jobs.

Samsung has already said it will make smartphones for export from its plant outside New Delhi, according to the Reuters report.

Other reports by Click Lancashire

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