Apple partners and Samsung win $143b under India’s Federal plan

Samsung and three major contract manufacturing partners of Apple are among 16 firms to win $6.65 billion incentives under India’s federal plan to boost domestic smartphone production over the next five years.

Indian Ministry of Electronics and Information Technology (MeitY) announced these companies will be producing smartphones and other electronics components worth more than $143 billion over the next five years. In return, India will offer them an incentive of 4% to 6% on additional sales of goods produced locally over five years, with 2019-2020 set as the base year.\

New Delhi’s move is aimed at significantly improving India’s manufacturing and exporting capacities and generating more local jobs. Around 60% of the locally produced products will be exported, the Indian ministry said. The companies will generate more than 200,000 direct employment opportunities in the next five years and as many as 600,000 indirect employment opportunities during the same period, the ministry said.

The move is also a precursor to how the dynamics among major smartphone makers might change in India, the world’s second-largest market, over the next few years. The inclusion of Foxconn, Wistron and Pegatronunderscores how rapidly Apple plans to expand its local manufacturing capabilities in India. Wistron began assembling a handful of iPhone models in India three years ago, followed by Foxconn. Pegatron has yet to start production in India.

“Apple and Samsung together account for nearly 60% of global sales revenue of mobile phones and this scheme is expected to increase their manufacturing base manifold in the country,” the ministry said.

“Industry has reposed its faith in India’s stellar progress as a world-class manufacturing destination and this resonates strongly with Prime Minister’s clarion call of AtmaNirbhar Bharat – a self-reliant India,” the ministry added.

 

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