Apple’s biggest supplier Foxconn is currently in talks with the Indian government to build an iPhone manufacturing plant in India; with a recent report suggest that the deal is close to being signed. The report also claims that Apple and Foxconn have identified a few locations in the state of Maharashtra to build the plant.
The deal will see a 1,200-acre of land in Maharashtra being acquired to set up a $10 billion (about RM40 billion) manufacturing plant, which is said to focus mainly on iPhone manufacturing. From the time the deal is inked, sources estimate it will take about 18 months before the facility is operational.
This move by Apple and Foxconn can be seen as an attempt to avoid the high import duties set in place by the Indian government. By manufacturing iPhones in India, Apple will be eligible under the “Made in India” flagship program and this means a more competitive price for iPhones in India. Owing to the high import duties, Apple currently has some of the highest priced products in the local market.
Foxconn is also reportedly aiming to set up 10-12 manufacturing plants in India by 2020, apart from the one in Maharashtra. This is the company’s second stint in India; they previously manufactured Nokia devices in the country before shutting down the production in 2014.
India has become an important market for Apple, with the company planning to set up a new technology centre in Hyderabad later this year. The $25 million (about RM100 million) centre will ultimately house 150 employees and will be a big step by Apple to enter the Indian market.