Taiwan-based electronics contract manufacturer Foxconn plans to manufacture iPhones in Bengaluru by 2024. Karnataka Minister for Large and Medium Industries MB Patil said this after a team of Foxconn representatives led by company representative George Chu visited the state capital on Thursday for a courtesy call. Patil also said the Karnataka government would hand over the required land to the company by July 1 to facilitate the production.
The state aims to create 50,000 jobs with the project, which the company dubbed ‘Project Elephant.’ The company will set up an iPhone assembly plant at the Information Technology Investment Region (ITIR) in Devanahalli on the city’s outskirts. The factory’s annual capacity will be up to 20 million iPhones per annum, a senior official from the ministry told reporters.
Currently, Apple manufactures most of its phones in China but also employs several suppliers in India, where it accounts for about 5 percent of total production. The new facility in Bengaluru will allow Foxconn to diversify its supply chain away from China and help it cope with a potential decline in global demand for consumer electronics.
The new plant will be built in three phases and cost around Rs 13,600 crore. In its statement, Foxconn said it has already paid 30 percent of the land cost to the state government and is expected to complete the project by April 2024. The company plans to produce two crore mobile phones annually at the new facility, which is expected to be the most giant factory in the world.
According to the state government, Foxconn will have to invest in setting up infrastructure and training eligible candidates for jobs at the facility. In addition, the firm will require 50 lakh liters of water daily, quality power, and good road connectivity. It will also have to provide housing facilities for the workers. The state will ensure that all these requirements are met, Patil said.
The tech giant is under scrutiny for poor labor conditions at its factories in Shenzhen. Thousands of workers have died in workplace accidents and suicides, and riots broke out during strikes over wages and working conditions. In addition, the company has been criticized by labor activists for providing low salaries and allowing employees to work overtime, violating local laws.
Foxconn has already invested in other plants in India, including a 1.2m sq ft plant in Tamil Nadu that makes older versions of the iPhone. However, the company has been facing stiff competition from domestic manufacturers and falling sales of smartphones globally as consumers are shifting to cheaper alternatives. Moreover, Apple’s shift to focus on services and cloud computing has reduced manufacturers’ demand for parts. In addition, the US-China trade war has added pressure on the smartphone maker to reduce costs. The new initiative will also give the company a foothold in the Indian market, considered a key emerging smartphone market.
