Foxconn plans to invest another $500 million in India over the next few years to ramp up its manufacturing capabilities to enable Apple to expand production of iPhones and other devices in the country.
That investment will clear the way for Foxconn’s India unit, Hon Hai Technology India Mega Development, to set up an electronics manufacturing and assembly unit near the Bengaluru international airport.
The new injection will be spread from 2023 to the project’s expected completion in 2027, according to a report by the Economic Times. It follows Foxconn’s infusion of $500 million last year into the India unit, bringing its total investment to around $1 billion.
“Apple phones are to be built in a new 300-acre factory in Karnataka…the double-engine governments of Prime Minister Narendra Modi and chief minister Basavaraj Bommai are working to get investments and add jobs,” India’s union minister of state for electronics and IT Rajeev Chandrasekhar tweeted.
Third Indian facility for Foxconn
Foxconn currently has two facilities in India— one at Sriperumbudur in Tamil Nadu under Hon Hai, where it makes iPhones, and the other operated by Bharat FIH (previously, Rising Star) in Sri City, Andhra Pradesh, which makes smartphones for Chinese handset maker Xiaomi.
Both units were cleared to receive incentives under the production-linked scheme (PLI) for smartphones. That scheme aims to incentivize handset makers to assemble phones in India for domestic and other markets in a bid to compete with countries like China and Vietnam.
Hon Hai Technology Group (Foxconn) Chairman and CEO Young Liu said in a statement said that his trip to India from February 27 to March 4 supported the company’s efforts “to deepen partnerships, meet old friends and make new ones, and seek cooperation in new areas such as semiconductor development and electric vehicles.”
“Foxconn will continue to communicate with local governments to seek the most beneficial development opportunities for the company and all stakeholders,” he added in his statement on Saturday.
100,000 new jobs, maybe
The Karnataka government said that the new facility will generate 100,000 jobs over the next 10 years. However, Foxconn officially clarified that it has not signed any definitive pacts, although negotiations with various state governments and internal reviews to invest in the country are ongoing.
“Foxconn hopes its investments will lead to direct and indirect jobs growth for local communities,” the company said in its statement. “Employment figures currently being discussed in the media do not equate to direct jobs by Foxconn… As a publicly listed company, Foxconn will disclose investment plans at the appropriate time as required by Taiwan securities regulators.”
In India, Apple makes iPhones via Foxconn, Wistron in India and Pegatron. All were approved under the PLI scheme.
The Indian government has been encouraging Apple to expand its local manufacturing ecosystem to generate annual production output worth $50 billion over the next five to six years.
To sweeten the incentives, India is currently preparing a plan to roll out new PLI schemes for notebooks and wearables production. These schemes will specifically target players like Apple and Samsung.