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Make In India Gains Momentum As Apple Supplier Foxconn Set To Invest $1B In Chennai

The plan of investing USD 1 Bn in India is touted to be Apple’s move to shift iPhone production away from China and hence reduce its dependence on the country.

Make in India

Amid the global anti-China sentiment due to China's discreet way of handling COVID-19, Industries and conglomerates across the world had been contemplating on gradually moving out of China in a bid to reduce the over-dependency on China for economic and industrial means. In a significant development, Foxconn, the Taiwanese electronic contract manufacturer, which assembles Apple iPhones in India, has planned to invest to the tune of USD one billion in India, according to reports. 

The plan of investing in India is touted to be Apple’s move to shift iPhone production away from China and hence reduce its dependence on the country, in the wake of the rising tensions between the US and China. Reuters has reported that there is a strong request from Apple to its clients to move part of the iPhone production out of China.

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Foxconn currently has two plants in Tamil Nadu and Andhra Pradesh where it assembles Apple and Xiaomi smartphones. In the company’s annual general meeting last month, Foxconn Chairman Liu Young-way had said, “We are fully pushing ahead with the next steps there, and maybe in a few months’ time, we can reveal on our website the next steps and report back to everyone. We will have a further investment there,” without revealing further details then. Neither Foxconn nor Apple has commented over it though.

The investment is said to take place over three years and will also add about 6,000 jobs at the Sriperumbur plant in Tamil Nadu state, which at present manufactures iPhone models in India. The plant manufactures the iPhone XR, Apple’s cheaper flagship-class iPhone. The older version of the iPhone SE and some other models that have been discontinued by the company globally were also manufactured in Sriperumbur plant. 

The upcoming investment is said to be in line with the new production-linked incentive (PLI) scheme by the Indian government. The PLI for Large Scale Electronics Manufacturing proposes a financial incentive to boost domestic manufacturing and attract large investments in the electronics value chain including mobile phones, electronic components including Assembly, Testing, Marking and Packaging (ATMP) units. Production Linked Incentives of up to INR 40,951 crores will be awarded over a period of 5 years and Foxconn was reportedly among the companies which had applied to the government for receiving the benefits from the scheme.

India's bid to ban Chinese apps

Amid the Indo-China standoff, India had banned 59 Chinese apps including TikTok and the government has now posed 79 questions to the apps on varying topics including financing, data security, funds, parent company, harvesting data of Indians, according to the sources. These companies which include TikTok, Helo and Xiaomi have been given 3 weeks' time to answer these questions. Several companies have sought a meeting with the Information & Broadcast (I&B) Ministry to explain their business and data management.  

Sources add that the government has already gathered enough information on these apps to implement a permanent ban, if needed. TikTok which has predicted a $6 billion loss due to the ban in India, has already ruled out taking any legal against the Government of India. The Chinese digital giant has stated that it is committed to working with the government to address its concerns and is considering changes in its company's structure.

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