Apple’s contract manufacturers in India – Foxconn, Wistron, Pegatron – lead the group of companies that are part of the Indian government’s enticing PLI (Production Linked Incentive) program.
Alongside these Apple iPhone manufacturers, Samsung is the other contender for this lucrative plan.
As reported last week, these companies’ applications have been approved by the Empowered Committee, which is made up of Niti Aayog CEO, Secretary of the Economy, Expenditure, Income, Department of Electronics and Information Technology (MeitY) Department of Funding of Industry and Internal Trade (DPIIT) and General Directorate for Foreign Trade (DGFT).
The Indian cabinet will be putting these motions up for discussion later this week.
Indian companies like Karbonn, Lava, and Dixon are also part of this popular government program that incentivizes phone manufacturers and turns India into a manufacturing hub. This plan aims to achieve cell phone production of $ 1
According to this scheme, the incentives to produce will increase every year as India tries to entice the world’s largest smartphone brands to manufacture their products in India.
However, phone makers like Huawei and BBK Group, which make brands like Oppo and Vivo, haven’t chosen to join this program.
India & Apple, a symbiotic relationship
The three major iPhone assemblers from Apple that are becoming part of this government stimulus plan come as no real surprise.
Apple has dropped enough clues about its plan to move its contract manufacturing from companies based in China. This is an existential crisis for Apple as relations between the US and China have become extremely frosty.
And India, which has its own problems with Beijing, is trying to win contracts that once went to China. Hence, it is more or less rolling out the red carpet for companies like Apple and Samsung.
It is a win-win plan for both camps and how the market looks.
The plan is simple. In order to receive incentives, foreign manufacturers must commit to specific investment and production targets for equipment that sells for at least Rs 15,000.
India hopes to attract another 10% of world cell phone production over the next five years. Most of the economic stimulus program is aimed at the export market.
India’s ambitious plans
According to a report by Bloomberg, “among the dozen phone manufacturers that have already been approved by a high-level government committee include Apple’s main supplier Foxconn Technology Group, which filed two applications, as well as colleagues Wistron Corp. and Pegatron Corp. The three companies will get almost every iPhone sold worldwide in sprawling factories, currently primarily in China. “This marks, the report said,” a potential seismic shift as the world’s most valuable company diversifies beyond China. “
“It is a thoughtful move by the government to solicit Apple to bring significant iPhone manufacturing to India because if the iPhone maker shifts, an entire ecosystem will follow,” said Hari Om Rai, chairman and founder of Lava International , India’s largest domestic phone manufacturer was quoted as saying.
“The next five years will be dramatic and India could become the new China in phone manufacturing,” he said.