Apple Inc is reportedly looking to increase its manufacturing presence in India. The US tech giant is reportedly planning to bring iPad manufacturing to the country as it looks to reduce its dependence on China, say media reports.
Its contract manufacturers Foxconn and Wistron have plants in India, while Pegatron is reportedly working on setting up a unit. Last year, the three companies were among the 22 firms that had registred for the Indian government’s production-linked incentive scheme.
Under the scheme, the government offers incentives to boost domestic manufacturing and attract large investments in mobile phone manufacturing and specified electronic components, including assembly, testing, marking and packaging units. The three Apple suppliers have committed roughly $900 million over five years to make iPhones in India.
Now the Indian government is reportedly preparing to unveil another production-linked incentive scheme to drive local manufacturing of IT products including tablets, laptops and servers. The new scheme will be in place for five years and is expected to offer cashback to manufacturers for exports.
Apple currently assembles the bulk of its iPads in China, but is fast diversifying production to markets such as India and Vietnam to minimize the impact of the US-China trade war. Earlier, there were reports of Foxconn planning to shift production of some iPad and MacBook models to Vietnam.
In India, Apple began assembling iPhones in 2017 and it has since ramped up manufacturing operations via the local units of Foxconn and Wistron.
Foxconn has committed to invest up to $1 billion to expand its facility near Chennai.
Wistron operates two manufacturing plants near Bangalore and produces the iPhone SE and the iPhone 7. Wistron has committed to investing roughly 13 billion rupees ($176.74 million) in smartphone manufacturing over the next five years. One of its plants was affected by labor unrest in December and is now expected to restart production soon.
Pegatron has reportedly leased half a million square feet space in an industrial park near Chennai and is expected to invest around $150 million.
Apple sales have been lackluster in India’s price-sensitive market. However, of late there has been an improvement in the iPhone sales in the country. In the calendar 2020, Apple nearly doubled its sales by registering growth of 93%. Its sales were driven by iPhone 11, iPhone SE and iPhone XR, while the new iPhone 12 series did well in the fourth quarter, says a report by International Data Corporation.