Apple is looking into shifting $40billion of production from China to India after coronavirus disrupted tech supply chains, report claims
Apple is considering moving a fifth of its production from China to India, a new report claims.
The tech giant is in talks with Indian officials about producing up to $40billion worth of smartphones over the next five years through manufacturers Wistron and Foxconn, according to the India's Economic Times.
The move - which could make Apple India's largest exporter - comes as the coronavirus pandemic that began in Wuhan, China, caused major disruptions in tech supply chains.
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Apple is reportedly in talks with Indian officials about producing up to $40billion worth of smartphones over the next five years through manufacturers Wistron and Foxconn. Pictured: Employees work on the assembly line at a Foxconn factory in Tamil Nadu
A government official told ET that Indian Prime Minister Narendra Modi met with top executives from Apple, Samsung and domestic phone producer Lava late last year to launch an ambitious production-linked incentive (PLI) scheme to bring more tech manufacturing to the country.
'India isn't a big market for Apple as the company sells only a fraction of its total output in India,' the official said.
'It is actually looking at India as a base to manufacture and export, essentially diversifying its production out of China.'
Under the PLI scheme companies are required to manufacture at least $10million worth of merchandise between 2020 and 2025.
At present, Apple manufactures about $500million dollars worth of phones in the country, which accounts for about $1.5billion of its phone sales, per ET.
By comparison, Apple produced about $220billion worth of merchandise in China in 2018-2019, with $185billion of that exported.
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The purported shift in production comes after the coronavirus pandemic that began in Wuhan, China, caused major disruptions in tech supply chains. Pictured: An Apple factory in China
ET reported that government officials have faced some pushback from Apple over the terms of the PLI scheme, which provides an incentive of four to six percent on incremental sales.
'There are some problems with some of the clauses,' the source said. 'For instance, valuing the entire plant and machinery already in use in its plants across China and other places at 40 percent of that value and the extent of the business information sought under the scheme are some of the irritants.'
However, the source said Indian officials are eager to resolve those issues so the plans can come to fruition.
Apple has not spoken publicly about the purported shift in production and did not immediately respond to DailyMail.com's request for comment.
Meanwhile, market experts have expressed skepticism over the PLI plan.
'We don't have ecosystem ready which could support any large-scale deployment,' Faisal Kawoosa, founder at research agency TechArc, told ET. https://www.dailymail.co.uk/news/ar...tion-China-India-coronavirus-disruptions.html
- Apple is in talks with Indian officials about producing up to $40billion worth of phones through local manufacturers, Indian Economic Times reported Monday
- Tech analysts say the move could make Apple India's largest exporter
- It comes as the coronavirus pandemic that began in Wuhan, China, caused major disruptions in tech supply chains
- Here’s how to help people impacted by Covid-19
Apple is considering moving a fifth of its production from China to India, a new report claims.
The tech giant is in talks with Indian officials about producing up to $40billion worth of smartphones over the next five years through manufacturers Wistron and Foxconn, according to the India's Economic Times.
The move - which could make Apple India's largest exporter - comes as the coronavirus pandemic that began in Wuhan, China, caused major disruptions in tech supply chains.
+2
Apple is reportedly in talks with Indian officials about producing up to $40billion worth of smartphones over the next five years through manufacturers Wistron and Foxconn. Pictured: Employees work on the assembly line at a Foxconn factory in Tamil Nadu
A government official told ET that Indian Prime Minister Narendra Modi met with top executives from Apple, Samsung and domestic phone producer Lava late last year to launch an ambitious production-linked incentive (PLI) scheme to bring more tech manufacturing to the country.
'India isn't a big market for Apple as the company sells only a fraction of its total output in India,' the official said.
'It is actually looking at India as a base to manufacture and export, essentially diversifying its production out of China.'
Under the PLI scheme companies are required to manufacture at least $10million worth of merchandise between 2020 and 2025.
At present, Apple manufactures about $500million dollars worth of phones in the country, which accounts for about $1.5billion of its phone sales, per ET.
By comparison, Apple produced about $220billion worth of merchandise in China in 2018-2019, with $185billion of that exported.
+2
The purported shift in production comes after the coronavirus pandemic that began in Wuhan, China, caused major disruptions in tech supply chains. Pictured: An Apple factory in China
ET reported that government officials have faced some pushback from Apple over the terms of the PLI scheme, which provides an incentive of four to six percent on incremental sales.
'There are some problems with some of the clauses,' the source said. 'For instance, valuing the entire plant and machinery already in use in its plants across China and other places at 40 percent of that value and the extent of the business information sought under the scheme are some of the irritants.'
However, the source said Indian officials are eager to resolve those issues so the plans can come to fruition.
Apple has not spoken publicly about the purported shift in production and did not immediately respond to DailyMail.com's request for comment.
Meanwhile, market experts have expressed skepticism over the PLI plan.
'We don't have ecosystem ready which could support any large-scale deployment,' Faisal Kawoosa, founder at research agency TechArc, told ET. https://www.dailymail.co.uk/news/ar...tion-China-India-coronavirus-disruptions.html
