Taiwanese electronics manufacturer Foxconn is set to invest up to $1 billion at the Sriperumbudur plant in Tamil Nadu state, reported Reuters. The plan comes at the backdrop of a quiet strategy, adopted by Apple, to shift its iPhone production from China to other countries in light of the coronavirus outbreak and the US-China trade war.
The Sriperumbudur plant, located 50 km away from Chennai, manufactures Apple’s iPhone XR model. The investment by Foxconn is expected to take place over a period of 3 years. Other iPhone models, which are currently manufactured in China, will also be manufacture at the plant. Reportedly, the new inflow of investment in the country will add 6000 jobs to the plant. Besides, Foxconn also has a factory in Andhra Pradesh wherein it manufactures Xiaomi phones.
Boost to ‘Makes in India’ initiative
According to a Hong-Kong based tech researcher, India’s cheap labour, coupled with the expansion of a supplier base would help Apple use the country for exports. Reportedly, building phones in India will help Apple save money on the import tax. Besides, the expansion of Apple in India will boost initiatives such as ‘Make in India’, the government’s flagship programme for indigenous production. Samsung, the rival of Apple, also has a factory in North India.
Foxconn vows increased investment
Without getting into details, Chairman Liu Young-way stated in June that the company will increase its investment in the country. “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’ll have a further investment there,” he was quoted as saying.
Last month, the government of India launched a ₹50,000 crore ($6.5 billion) ‘Electronics manufacturing’ scheme and offered lucrative offers to global smartphone workers to set up their factories in India. “We launched this programme to show our intent that India is ready for business,” IT minister Ravishankar Prasad was quoted as saying.