iPhone: Made in India becomes a regular feature

iPhone: Made in India becomes a regular feature

Every fourth iPhone will be manufactured in India by 2025 as per JP Morgan analysts read last month and Apple recently announced its plan to produce 5 percent of its latest model – iPhone 14 this year in India much earlier than expected.

This is seen as the tech giant’s strategy to diversify manufacturing and move its factory out of China amid rising geopolitical tensions and global supply chain “de-risking” taking place due to China’s “zero Covid” policy, but India shows the desired destination as a significant milestone in the company’s history and India’s readiness, past performance , especially its remarkable resilience during and after the second wave of Covid-19 and efficiency as well.

Read also: Apple is rolling out a beta program for 5G on its devices

It is a well-known fact that the vast majority of electronic, electrical equipment and manufacturing in the world has been confined to a few select countries such as China.

Apart from the well-thought-out factors like cheaper and larger workforce, it was also due to the business-friendly ecosystem in such countries. However, with the looming pandemic and supply chain constraints seen over the past couple of years, the harmful effects of any industry’s over-reliance on China, or any one country for that matter, have been evident to the world.

Disruptions in the single supply chain from China have also had a domino effect, severely hindering the interests of the larger population. Many distant countries had to pay a heavy price. Taking lessons from what the world faced in the past two years, the world has been actively trying to secure sites and other countries to set up their own manufacturing units and usher in a new era of electronics and equipment manufacturing as well.

Over the past few years, India has made rapid strides in the manufacturing sector as well as the electronics manufacturing sector as part of its resolve to no longer depend on the thin supply chain emanating from China. The highly successful tech and innovation giant Apple has announced that its largest iPhone manufacturing unit will appear in Hosur, Bengaluru, employing around 60,000 people on its own. Of these, the first 10 percent, i.e. 6,000 employees, will be tribal women from Jharkhand who have undergone training in making these specific iPhone mobile devices. This provides more opportunities not only for the rural people but also for the tribal sisters who have remained outside the mainstream until now.

In this context, it is not surprising that Foxconn, Apple’s main supplier, recently announced its collaboration with Indian giant Vedanta to set up a semiconductor manufacturing unit in Gujarat. With this plant in operation, India will enter the elite club of 5 countries that have the capacity to manufacture glass and semiconductors as well.

So, it has become a noteworthy milestone and indeed a revolutionary step that these global giants are finally making their presence felt instead of just seeing the potential in India.

“Geopolitics and geoeconomics are undergoing a sea change. The world is looking forward to embracing the China Plus One strategy, and India is clearly well positioned. This is India’s moment,” said Anil Agarwal, Chairman, Vedanta.

In the wake of escalating geopolitical tensions emanating from China and a consequent decline in mobile device production by several non-Chinese technology platforms, technology and business analysts reported that tech giant Apple was looking for ways to move about 5 percent of iPhone production and 25 percent of all Apple production including Mac, iPad, Apple Watch and Airpods, away from China towards India – the world’s second largest smartphone market.

This is a result of declining sales expectations, fears of an upcoming recession as well as efforts by tech giants to shift production towards more peaceful and stable regimes such as India. From the point of view of industries and manufacturing, India is becoming more lucrative than before with new age policies and business outlook apart from reduction of red austerity and simplification of single window permits amid previous bureaucratic hurdles in place. This single step will be able to create a huge ecosystem of ancillary industries in India as well.

India, the fifth largest economy in the world, is striving to position itself as an attractive manufacturing and export hub for multinational corporations.

After cutting corporate tax rates in September 2019, India’s Finance Minister Nirmala Sitharaman said, “If Apple and its entire ecosystem move to India, it will have a bigger impact on other companies” and it has happened. The increased focus on India can be attributed to India’s operating conditions and cost competitiveness. In addition, the country has proven to be successful in catering to outsourcing requirements that have created a suitable ecosystem for multinational companies. It has earned the trust of many countries around the world with its true spirit of hard work, professionalism and ethical practices. It has a large domestic market and a large pool of low-cost talent.

Apple Inc. has been manufacturing iPhones at the Foxconn Sriperumbudur plant in the south Indian state of Tamil Nadu since 2017. Apple sources iPhones from electronics giants – Foxconn, Wistron and Pegatron in India. Apple has already outsourced the manufacturing of iPhones India to the Tata Electronics plant in Hosur which is expanding its facility and sourcing an iPhone contract manufacturer. Now, India is all set to acquire the largest iPhone manufacturing unit for Apple Inc. in the same city.

Furthering the announcement that the manufacturing unit’s workforce will quadruple within the next two years, expansion of existing facilities and expansion of production scale has also been reported by various sections of the media. In turn, this is bound to surely lead to more investment and the creation of many new projects as well. With the potential to improve the livelihood of thousands of individuals as well as put India on the global electronics map, the government is ramping up support for its agenda of self-reliance or atmanirbharta through various government policies and regulations as well.

With a renewed focus on research and development in this sector, this inward-looking approach of the Indian government has ensured that our local manufacturing capabilities have enough support to stand by and deliver should the need arise. By playing a significant role in innovation, this effort to develop India into a manufacturing hub with a business-friendly ecosystem would help the nation and the world as well.

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