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Apple’s top manufacturer Foxconn to invest in Karnataka and Telangana

Foxconn Technology Group will be opening new manufacturing facilities in Bengaluru and Hyderabad

Foxconn to create new production sites in India. (AP Photo/Chiang Ying-ying, File)
Foxconn to create new production sites in India. (AP Photo/Chiang Ying-ying, File) (AP)

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Apple Inc.’s top manufacturer, Foxconn Technology Group, might be headed to India with major expansion plans which could include new production sites. On Monday, the Taiwanese company confirmed their commitment to set up manufacturing facilities in Karnataka and Telangana in a statement addressed to Chief Ministers, Basavaraj Bommai and K Chandrashekar Rao.

Last week, Bloomberg reported that Foxconn Technology Group is planning to invest about $700 million in a new plant in India to increase local production, boosting its shift away from China as Washington-Beijing tensions increased. The initial report stated that its flagship unit Hon Hai Precision Industry Co., aims to build the plant to manufacture iPhone parts on a 300-acre site in Bengaluru.

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Following Foxconn CEO Young Liu's visit to India from 27 February to 4 March, Karnataka CM Bommai released a statement on Friday that Apple would “soon" manufacture iPhones at a new plant in the state, creating "about 100,000 jobs". CM Chandrashekar Rao, also tweeted that Liu had signed an agreement on Thursday to "set up electronics manufacturing facilities", as reported by Mint.

However, talking about the trip, Liu said in a statement, "My trip this week supported Foxconn's efforts to deepen partnerships... and seek cooperation in new areas such as semiconductor development and electric vehicles.”

He also denied entering into any agreements. “Foxconn has not entered into binding, definitive agreements for new investments during this trip," the statement said. "Negotiations and internal review are ongoing. Financial investment sums discussed in media are not the information being released by Foxconn."

In a turn of events, Foxconn on Monday confirmed the investments that the two Chief Ministers had spoken about on Twitter. It will be setting up a manufacturing facility in Kongara Kalan near Hyderabad.

“As discussed with you (Telangana CM) during our meeting on 2 March, Foxconn is committed to setting up a manufacturing facility in Kongara Kalan and I seek the support of your team in operationalising the Kongara Kalan park as early as possible,” Liu said in the letter, shared by the CM’s office on Twitter.

Foxconn has also signed a “letter of intent” stating that it will be setting up a manufacturing facility over a 300-acre land parcel at an industrial area near Doddaballapura within a period of five years. In a statement, the company said it will be in “close contact” with the Karnataka government to ensure the “successful grounding” of its manufacturing project near Bengaluru.

“My team will be in close contact with your team to take this forward and ensure the successful grounding of ‘Project Elephant’ in Bengaluru. I am confident that this project will lay a strong foundation for our other multiple plans, spanning mechanical/precision machinery, electric vehicle, IC design & semiconductor segments to consider your state as a potential investment destination,” Liu said in the statement, as reported by PTI.

Currently, Apple is the top job creator in the electronics sector by generating 100,000 direct employment opportunities in the last 19 months, as reported by Business Standard. According to Mint, the three key vendors assembling iPhones - Foxconn Hon Hai, Pegatron, and Wistron - have collectively produced 60% of the newly created jobs. Foxconn Hon Hai, based in Tamil Nadu has created more than 35,500 jobs, which is more than a third of the total jobs generated.

In this tweet, Karnataka CM Bommai stated that Foxconn’s facility in Bengaluru is expected to create 100,000 jobs.

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