Apple wants a quarter of its products manufactured in India, claims minister
- Reference: 1674538394
- News link: https://www.theregister.co.uk/2023/01/24/apple_india_manufacturing/
- Source link:
Speaking on Monday at the inaugural session of the B20 India Inception – a part of the G20 dialog – Goyal called Apple a "success story" for Indian manufacturing.
"They launched the most recent models from India, manufactured in India and our honorable minister is carrying it with him, a Made In India Apple phone, and with that will follow the ecosystem, the supply chain," [1]beamed [VIDEO] Goyal.
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"They are already at five to seven percent of their manufacturing in India. If I am not mistaken, they are targeting to go up to 25 percent," Goyal said.
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The minister attributed interest from Apple and other manufacturers to India's transparent rule of law.
"We don't have opaque business models, we don't have hidden subsidies, we don't have anything done in the government which is not known to the public at large," said Goyal, not long after news broke that the nation's government invoked emergency laws to prevent access to a BBC documentary critical of prime minister Narendra Modi.
[5]Foxconn sinks $500m into India for iPhones, semiconductors
[6]India wants to quadruple electronics biz in just four years
[7]Foxconn will have to forget about investing in Tsinghua Unigroup
[8]Indian government starts work on right to repair rules
In December 2022, Apple supplier and electronics manufacturing giant Hon Hai Precision Industry Co., Ltd, also known as Foxconn, [9]disclosed in a stock exchange filing that it would invest $500 million to expand its manufacturing presence in India, inclusive of semiconductors, as a "long term investment."
Analysts have predicted a shift in hardware production after COVID-19 demonstrated the folly of concentrating manufacturing in one location. Lingering [10]supply chain challenges resulting from from China's zero COVID policies, plus sanctions that make it hard to import some tech products, have also given manufacturers good reason to diversify their suppliers.
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India, meanwhile, has [12]sought to quadruple its electronics manufacturing business by 2026.
Prior to Goyal's speech, minister for railways, IT and communications Ashwini Vaishnaw spoke on India's approach to preventing monopolies through public-private partnerships.
"Our prime minister took the approach: Can we build a system a digital ecosystem in which the monopoly of any Big Tech doesn't come? Can the digital system be very inclusive? Can it create opportunities for multiple stakeholders? With that as the fundamental construct in his mind he launched the Digital India program in 2015."
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Vaishnam said that approach led the government to use public funds to build sector-specific platforms through public-private partnerships – examples include a payment platform and a vaccination-related platform. At that point, Vaishnaw said the government "let everybody else join those platforms and build solutions."
The minister also provided some details of its 4G and 5G technology stack. Vaishnam [14]said the system, which was leveraged by a public-private partnership, has now been tested for ten million simultaneous calls.
Goyal told the event that the Indian economy grew by a factor of 12 in US dollar terms since 1991 years to reach GDP of $3.2 trillion.
"There is no other market in the world as large as the India opportunity today," said the minister, noting that it's not just tech that will benefit: local sales of products like dishwashers will boom as more women enter the workforce.
"India would like to share with the world the big opportunity for economic growth, for powering the world economy also to grow, for collaborations, for cooperation. We can remain competitive, and also collaborate and collectively see how we can help serve the world with India as your base." ®
Get our [15]Tech Resources
[1] https://youtu.be/5TzbXuFtI14?t=2417
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Y8@6UPSAx2agOegUjX8fkAAAAMU&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y8@6UPSAx2agOegUjX8fkAAAAMU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y8@6UPSAx2agOegUjX8fkAAAAMU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2022/12/09/foxconn_tata_india_semiconductor_investment/
[6] https://www.theregister.com/2022/08/31/india_electronics_report/
[7] https://www.theregister.com/2022/08/10/foxconn_tsinghua_investment/
[8] https://www.theregister.com/2022/07/18/india_right_to_repair_framework/
[9] https://www.theregister.com/2022/12/09/foxconn_tata_india_semiconductor_investment/
[10] https://www.theregister.com/2022/10/26/foxconn_iphone_factory_lockdown/
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y8@6UPSAx2agOegUjX8fkAAAAMU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[12] https://www.theregister.com/2022/08/31/india_electronics_report/
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y8@6UPSAx2agOegUjX8fkAAAAMU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[14] https://twitter.com/AshwiniVaishnaw/status/1617571396342927360
[15] https://whitepapers.theregister.com/
"Manufacturing" in India is the tip of the iceberg
They are talking about final assembly, which is taking all the parts and putting them together into a finished phone. But the second tier suppliers who supply many of those parts and materials, and the third tier suppliers who supply parts and materials used by second tier suppliers will remain in China, because not just Apple but most of the western world quit doing a lot of that stuff themselves because China could do it cheaper.
If there was ever a full trade embargo from China pretty much zero US or EU companies could ship any physical product. Of course China can't do that because that would devastate their economy and if they had riots over covid restrictions they would have revolution over their economy cratering overnight. But the idea that Apple assembling phones in India instead of China, or any western company "manufacturing" its products in its home country, frees them from future trade or supply issues with China is naive to the extreme.
It is good that India wants to move down that value chain and do more than just assemble products, but it took China decades to build up that capability. It would take India takes to do likewise, and meanwhile western countries who are beginning to wake up the strategic risk of being held hostage by supply chains in the event of a major war will be trying to cherry pick some of those capabilities deemed important for the defense industry.
Re: "Manufacturing" in India is the tip of the iceberg
China uses a bunch of non-tariff barriers to make it easier to do the whole job in China.
We made our key component in a backwater well away from China, and there were a lot of small difficulties thrown up at the border to try and just make it a lot simpler to do it all in-country.
Then when there were actual CN customers (rather than TW and US principals) they flat refused to buy non-CN components (and freely admitted it was because of government local content requirements that meant if it had an offshore cpu, everything else needed to be CN).
Moving final assembly out of China, frees you to move other components out of China too.
Some of those components are things you might prefer to make somewhere else, not necessarily India, that will probably end up being much like CN business wise.
(This is not about active dishonesty. There are simply too far many people and businesses in your line of business and too much staff turnover, to expect to keep any trade secrets for long.)
Re: "Manufacturing" in India is the tip of the iceberg
As a Chinese customer I would also prefer all made in China, as they don't know what sanctions from the US will come next, it is unsafe otherwise.
I assume you moved your operation somewhere else..
cost, cost, cost...
"The minister attributed interest from Apple and other manufacturers to India's transparent rule of law."
My guess is that it's all about cost. As China has grown massively in the last 15 years, costs there have also shot up relative to India and other countries in SE Asia. China is no longer a 'low-cost' manufacturing hub, just lower-cost than EU and US with high level of expertise. And Apple wants to cling on to it's massive margins.
UK
Why not in the UK?
Oh we know why.
As China's GDP is rising, companies are following the path of the "poorer one" to maximize their profit. There must be a Law of Acquisition to describe this.
“We don’t have opaque business models, we don’t have hidden subsidies, we don’t have anything done in the government which is not known to the public at large,”
And for God's sake, stop sniggering down the back Patel.