Apple’s contract manufacturers in India – Foxconn, Wistron, Pegatron – lead the group of companies that are part of the Indian government’s seductive PLI (Production Linked Incentive) program.
In addition to these Apple iPhone manufacturers, Samsung is the other applicant for this lucrative plan.
As reported last week, the applications from these companies have been approved by the ‘Empowered Committee’, which consists of the CEO of Niti Aayog, the Secretaries of Economic Affairs, Expenses, Revenues, the Ministry of Electronics and Information Technology (MeitY), Promotion of industry and internal trade (DPIIT) and Directorate-General for Foreign Trade (DGFT).
The Indian cabinet will be discussing these applications later this week.
Indian companies such as Karbonn, Lava and Dixon are also part of this popular government plan that aims to boost phone manufacturers and turn India into a manufacturing hub. This plan aims to generate $ 150 billion in cell phone manufacturing over the next five years.
Under this schedule, production incentives will increase every year as India hopes to entice the world’s biggest smartphone brands to make their products in India.
But emphatically, phone manufacturers such as Huawei and BBK Group, which produces brands such as Oppo and Vivo, have made no bids to participate in this program.
India & Apple, a symbiotic relationship
Apple’s three main iPhone assemblers that will become part of this government stimulus plan is no real surprise.
Apple has dropped enough clues as to its plan to move its contract manufacturing from companies in China. This is sort of an existential crisis for Apple as the ties between the US and China have become extremely icy.
And India, which has its own problems with Beijing, is trying to win contracts that once went to China. So it more or less rolls out the red carpet to companies such as Apple and Samsung.
It is a win-win plan for both camps, as the market sees the development.
The plan is simple. To receive incentives, foreign manufacturers must commit to specific investment and production goals of devices sold for at least Rs 15,000.
In the next five years, India hopes to attract another 10% of the global mobile phone production. Most of the incentive program is aimed at the export market.
India’s ambitious plans
According to a report by BloombergAmong the dozen phone makers already approved by a powerful government commission are Apple’s main supplier Foxconn Technology Group, which filed two applications, and colleagues Wistron Corp. and Pegatron Corp. The three companies make virtually every iPhone sold worldwide. in sprawling factories currently located primarily in China. “This marks, the report said,” a potential seismic shift as the world’s most valuable company diversifies outside of China. “
“It is a deliberate move by the government to convince Apple to bring significant iPhone production to India because when the iPhone maker shifts, an entire ecosystem will follow,” said Hari Om Rai, chairman and founder of Lava International, India’s largest homegrown telephone producer, was quoted as follows.
“The next five years will be dramatic, and India could become the new China in telephone manufacturing,” he said.