- Apple assemblers are flocking to India to take advantage of tax-cut investment programs.
- These are mainly China-based manufacturers who are fed up with the restrictions of the government.
- Hundreds of thousands of new jobs will be created in India in the next five years as a result.
Apple is looking to take the production from the “problematic” China to India, and the reasons behind this are multiple. The US-China trade wars are pushing for change on that part, and Apple constantly has to deal with demands from both sides. An unstable environment that affects production output is something that the consumer electronics maker cannot accept for much longer.
At the same time, Apple needs to establish a strong foothold in India, which is also a vast market, and it just so happens that lucrative tax-cutting investment plans are running right now, courtesy of the government.
According to reports that cannot be confirmed yet, Foxconn, Wistron, and Pegatron are all planning to move large chunks of their production volume in India. All three of them are iPhone assemblers, so this is likely a part of a bigger plan that has Apple pulling the strings. Last month, news outlets mentioned pressure from Apple towards Foxconn to move production to India. “Apple Insider” reports that in total, six production lines capable of outputting $5 billion worth of products yearly are now moving to India. As a result, 55,000 jobs will be created there.
Reportedly, the new facility will initially focus on the production of iPhones, but with time, it will expand to manufacture iPads, Macs, and Macbooks. The Times of India doubles down on these rumors, reporting that a large number of containers loaded with production-related goods from one of Apple’s key assemblers have already reached the country.
This process actually started months ago, when electronic producers feared that the COVID-19 situation would disrupt their operations for a very long time. The outbreak wasn’t contained in China after all, but the government’s restrictive measures and the political tensions remained good reasons to force companies to look elsewhere anyway.
According to Communications and IT minister Ravi Shankar, 22 big tech producers have already applied under the tax benefits program, which will bring in investments of about $1.5 trillion over the next five years. As for job generation, the plan is expected to open 300,000 direct positions and another 900,000 indirect jobs over the same period.
Given the current tensions between China and India, Prime Minister Narendra Modi felt the need to mention that this program is not aimed to punish or undercut China but boost local manufacturing and reduce dependence on imports. India wants to become a significant global player in the electronics manufacturing segment, and this program will give the country a big push in that direction.