Big boost: Apple plans to move part of its manufacturing from China to India

As several multinational companies are considering moving their production units out of China amid the Coronavirus outbreak, the Indian government is strategizing plans on attracting these firms to the country to a boost to the domestic market. In the wake of these developments, Apple Inc is, reportedly, planning on shifting nearly a fifth of its production capacity out of China to India. As per media reports, top-ranking executives at Apple and senior government officials have held several meetings in the past few weeks, discussing the possibilities of shifting a part of Apple Inc manufacturing facilities to India.

As of now, Apple contracts manufacturing companies Foxconn and Wistron to manufacture a range of its products. And if the negotiations between the Indian government and Apple officials reach a deal, the multinational giant will allow its supply partners to mass-produce smartphones and other products. Moreover, it will not only be used for domestic consumption but will be exported to the global market as well.

With this progress, Apple will be able to make $40 billion (roughly Rs 3.11 lakh crore) worth business with just exports in the next five years, making the electronic and technology giant the single biggest company in India to achieve the feat. Currently, Apple has a market share of 2-3 percent selling smartphones worth approximately $1.5 billion. Notably, less than $0.5 billion of the total Apple sale is India is domestically manufactured. 

In an attempt to attract production facilities of a number of multinational companies to India, Prime Minister Narendra Modi also held meetings with top executives of tech giants such as Samsung, Apple and Lava in December 2019. Furthermore, in March 2020, the Union Cabinet took significant decisions to develop the manufacturing industries in India, particularly in smartphones, electronics and semiconductors, with the launch of three different schemes –  Production-linked incentive scheme (PLI), Electronics Manufacturing Clusters (EMC) 2.0, and Scheme for promoting manufacturing of electronic components and semiconductors (SPECS). As per media reports, the Centre has earmarked a budget plan for over Rs 40,000 crore for the next five years under the PLI scheme to boost domestic manufacturing by attracting multinational tech giants to the country.

Apple’s two key contract manufacturers Wistron and Foxconn have already set up their production units in multiple cities of India, including Bengaluru and Chennai in the previous years and have been producing and assembling iPhone SE and iPhone 6S devices for sale in India.

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