Foxconn has reportedly concluded talks to set up a mega facility on a 300-acre plot near the Bengaluru International Airport
The investment is expected to be routed to India in stages and will add 1 Lakh jobs in the state over the coming years
Apple shipped more than INR 30,000 Cr worth of iPhones from India between April and December 2022
In a major push to diversify its production outside China, Apple’s contract manufacturer Foxconn will reportedly invest up to $1 Bn to set up a manufacturing facility on the outskirts of Bengaluru.
While a Bloomberg report pegged the investment amount at $700 Mn, a report by the Economic Times said that the commitment hovered around the $1 Bn mark.
While the details are yet to be made public, the Taiwan-based manufacturer has concluded the talks to set up the facility on a 300-acre plot near the international airport in Bengaluru.
“Apple phones to be built in the state soon. Apart from creating about 100,000 jobs, it will create a whole lot of opportunities for Karnataka. Under the visionary leadership of Hon’ble PM @narendramodi Ji, we will do our share to make India a $5 Tn economy by 2025,” Karnataka Chief Minister Basavaraj Bommai said in response to a tweet by Union Minister Rajeev Chandrsekhar.
The investment is expected to be routed to India in stages and will add 1 Lakh jobs in the state over the coming years. The plant is being touted as Foxconn’s largest such campus in India and is expected to help Karnataka emerge as an electronics manufacturing hub.
The upcoming plant will likely assemble Apple handsets and may also be used to produce some parts for Foxconn’s nascent electric vehicle business. However, sources told ET that the facility would be a pure play electronics manufacturing facility.
It could not be immediately ascertained if the plant would add new production capacity or would involve shifting some of its production from other Chinese facilities.
The development comes close on the heels of Foxconn Chairman Young Liu and his 17-member team visiting the proposed site of the plant in the Information Technology Investment Region (ITIR) near Kempegowda International Airport.
India Races Ahead
If Foxconn’s move to set up the plant in India materialises, it would provide a boost to the government’s ‘Make In India’ initiative. Besides, it would be a big win for the country against its neighbour China, which still accounts for a majority of iPhone production. China has been hit by Covid-19 restrictions and a logistical nightmare which has taken the sheen off the country as an attractive destination to manufacture Apple products.
Growing confrontations between Beijing and Washington DC have only added fuel to the fire and have seen Taiwanese manufacturing players looking to diversify their production outside of China.
India has emerged as a lucrative investment destination for companies owing to the production linked incentive (PLIs) schemes launched by the Prime Minister Narendra Modi-led government to boost manufacturing of mobile phones, electronics goods, among others, in the country.
Recently, Apple’s key vendor Jabil Inc began manufacturing AirPods components in India, while another vendor Salcomp announced plans to double its workforce in India to 25,000 by 2026.
Foxconn also has manufacturing facilities in Tamil Nadu and Andhra Pradesh. While the prospective Bengaluru plant could create as many as 1 Lakh jobs, its assembly campus in China’s Zhengzhou employs some 2 Lakh workers currently.
Earlier this week, it was also reported that Apple has emerged as the biggest blue-collar employer in India, generating 1 Lakh new direct jobs in the last 19 months through its three contract manufacturers – Foxconn Hon Hai, Pegtron and Wistron.
The tech giant exported iPhones worth $1 Bn from India in the last month of 2022. In the first nine months of the fiscal year 2022-23 (FY23), it shipped more than INR 30,000 Cr worth of iPhones from the country.