The latest in a series of bets from the key Apple contract partner as it expands its base in the South Asian market is that Foxconn will invest $500 million to set up manufacturing plants in the southern Indian state of Telangana.
Telangana’s IT minister, K.T. Rama Rao, tweeted that the “first phase” of the investment from Foxconn will result in the creation of 25,000 direct jobs. According to Reuters, Foxconn won a bid earlier this year to manufacture the AirPods in India, where it already produces iPhones. Local media reports also say that it bought land in Bengaluru earlier this month for $37 million.
Foxconn, Wistron, and Pegatron have made commitments as a result of India’s Prime Minister Narendra Modi’s financial incentives to encourage local manufacturing over the past few years.
Compared to many of its global rivals, Foxconn entered India in 2006, years ahead of schedule. “During this time period, we have accumulated much experience in managing local employees, supply chain and logistics, which are all important competitive advantages that have allowed us to move at a pace that is faster than the market. It has also allowed us to expand quickly. Apart from continuing this momentum, we will also be increasing production yield locally.” This is in addition to continuing this momentum.
“India has now reached a population of 1.4 billion people, translating to a large potential market for mid-to-high-end products which our clients are focusing on. Hence, it is necessary for us to continue to expand assembly and component operations in India. We see that more and more suppliers are investing in establishing plants in India and believe that this will become more prominent as time goes on. As for labor costs, India also has its advantages. Hon Hai will also continue to apply for government incentives, to increase its competitiveness.”
Additionally, the iPhone maker is attempting to expand its manufacturing infrastructure beyond China at the same time as the growing interest from its manufacturing partners.
Apple, which opened its first two retail locations in Quite a while last month, could extend its iPhone fabricating limit in India to deliver 25% of all iPhones by 2025, as per JP Morgan examiners.