Foxconn to build up to 12 factories and employ 1 million people in India

Discussion in 'Economy & Infrastructure' started by Srinivas_K, Jul 13, 2015.

  1. Srinivas_K

    Srinivas_K Senior Member Senior Member

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    Foxconn to build up to 12 factories and employ 1m in India


    Taiwanese manufacturing group Foxconn is planning an aggressive expansion in India, building up to 12 new factories and employing as many as 1m workers by 2020 as it battles rising wage costs and labour disputes in China.

    The move signals a shift in strategy for the technology company, which is mainland China’s biggest private-sector employer and is best known as the largest global contract manufacturer of Apple’s iPhone and iPad devices.

    India has long hoped that its vast pool of cheap workers would see it become the world’s next manufacturing powerhouse after China, only to find its ambitions thwarted by poor infrastructure and complex labour regulations.

    But Foxconn said it sees “huge potential” to set up Chinese-style facilities in the country, providing a boost to Prime Minister Narendra Modi’s “Make in India” manufacturing drive.

    The Taiwanese group is the most significant global manufacturer to announce plans to establish new facilities in the country since Mr Modi took power in May last year, following an election campaign in which he pledged to provide jobs for the 10-12m Indians who enter the labour market each year.

    Foxconn’s move is also likely to make India its largest production base after China, where it operates more than a dozen large facilities, employing the vast majority of its more than 1m global workforce.

    “We have significant plans for India and we see huge potential in the country,” Foxconn Technology Group said. “This includes plans to establish 10 to 12 manufacturing facilities in the country by 2020, which would generate around 1m job opportunities.”

    The news follows a trip to India by Foxconn founder Terry Gou last weekend. Mr Gou visited the southern IT hub of Bangalore on Saturday, announcing plans to establish a fund to invest in Indian technology start-up companies.

    Facing rising wage bills in China, Foxconn, which is also known as Hon Hai Precision Industries, has tried to leave behind its low-cost image by investing in robotics and other advanced technologies.

    But analysts said the group’s Indian expansion signalled a broader shift in which Foxconn would look to move low-end manufacturing from China to India, while seeking to supply companies targeting India’s domestic market, such as Chinese smartphone maker Xiaomi.

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    “This affirms what people have been saying, namely that manufacturing companies that are big in China are seeking other places to produce, and in particular India,” says Arun Maira, the former chairman of Boston Consulting Group, the professional services firm, in India.

    “So this is a very significant move for Foxconn, but also for India itself, because Foxconn is an exemplar of the type of large-scale manufacturing facilities, which are well entrenched into global supply chains, that India needs to attract.”

    Foxconn’s plans come despite a recent torrid period in India, where it has operated since 2007. This year it was forced to shut a factory in the southern city of Chennai, following regulatory difficulties faced by Nokia, the facility’s main client.

    However it also follows the announcement last month of a new investment partnership between Foxconn, Japan’s SoftBank and India’s Bharti Enterprises, to invest as much as $20bn into Indian solar energy over the next decade.

    http://www.ft.com/intl/cms/s/0/1ef06826-2952-11e5-8613-e7aedbb7bdb7.html#axzz3fmrCpOZA

     
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  3. Satybharat

    Satybharat Regular Member

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    that's great...2 lakh jobs per year,,,

    what happen to FABs?
     
  4. blueblood

    blueblood Senior Member Senior Member

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    Too big, too soon, too unrealistic?
     
  5. Abhijat

    Abhijat Regular Member

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    Nice, it will reduce our import bill

    @blueblood , our PM is serious about creating manufacturing base , especially for electronics equipment, because if we don't go for such mass expansion in this sector , then our import bill for electronics equipment by 2022 , would be around $400bn .

    http://articles.economictimes.india...645_1_electronic-development-fund-esdm-elcina

    Modi for big push to electronics manufacturing: Ravi Shankar Prasad

    "India imports electronic goods worth $100 billion every year which is likely to become $400 billion by 2020. The (electronics) import bill may surpass fuel oil import bill," Prasad said.
     
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  6. jouni

    jouni Senior Member Senior Member

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    So, How big is the salary difference to China?
     
  7. Srinivas_K

    Srinivas_K Senior Member Senior Member

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    I think 1/3rd of what chinese demand or even less.
     
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  8. blueblood

    blueblood Senior Member Senior Member

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  9. jouni

    jouni Senior Member Senior Member

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    A lot of factories have also moved back to Finland from China in recent years. Anyway getting those factories will help India develop anyhow, it is good news.
     
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  10. rock127

    rock127 Maulana Rockullah Senior Member

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    Good news... let's see when it comes on ground.

    Let's see action begins before 2019.
     
  11. ezsasa

    ezsasa Senior Member Senior Member

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    I hope these are not just assembly factories, let's see if they manage to setup the entire manufacturing supply chain here.

    After Micromax, Lava and samsung this is the fourth big player to start in india. i really hope somebody starts manufacturing 40 inch+ LED tv here, i have always felt they are overpriced atleast by 10-15k.
     
  12. Abhijeet Dey

    Abhijeet Dey Regular Member

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    This is a good opportunity for India to showcase talent to countries such as Taiwan etc. I think FICCI and other state government bodies should start India-Taiwan business partnership so as to get more investment from Taiwanese companies other than FOXCONN. Also Taiwan has 5th largest foreign exchange reserves in the world (three places ahead of India). The Taiwanese government may also invest in India's infrastructure projects and other sectors.

    How will China react to this? :biggrin2:
     
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  13. Sakal Gharelu Ustad

    Sakal Gharelu Ustad Detests Jholawalas Moderator

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    Micromax is Indian brand as far as I remember.

    Btw, supply chains are fragmented all over the world. No one builds everything in this day.
     
  14. sorcerer

    sorcerer Senior Member Senior Member

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    Workable..
    Deals like this will make India a global technical and defense manufacturing hub.

    India got talents!!

    Using India as a manufacturing destination to leverage China...is a good and viable idea.

    Lets hope the commie a$$#0l3s in here doesn’t create issues using labor unions to help the Chinese and thwart the nation building process.
     
  15. amoy

    amoy Senior Member Senior Member

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    Don't get why Indian posters make this an India-v-China matter as usual.:biggrin2:

    Your competitive edge is there from Day-1 - cheap labour, talent, a vast internal market...

    If Foxconn / Hon Hai wanna invest in India that's fine like they did in Indonesia, Brazil... targeting local sales or exports. The capital flows globally in pursuit of maximal returns.

    Therefore India is no virgin land for Foxconn. They surely know your Strength Weakness Opportunities and Threats to make an easy comeback.
     
  16. Abhijeet Dey

    Abhijeet Dey Regular Member

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    Problems such as Daiyou/Senkaku islands and South China Sea dispute will force US and other East Asian nations to shift their businesses from Mainland China to other friendly countries such as India. It seems Chinese are indirectly creating jobs in India. :biggrin2:

    China’s loss in manufacturing may well be India’s gain: World Bank president Jim Yong Kim

    http://articles.economictimes.india...obal-manufacturing-hub-boosting-manufacturing
     
  17. The enlightened

    The enlightened Regular Member

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    Business are run by people and profit, not governments and policies.
     
  18. amoy

    amoy Senior Member Senior Member

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    on geopolitics East Asia mainly refers to CJK (plus Mongolia and Taiwan if u wish). two Koreas would b happy to see China lock horns with Japan over Diaoyu since they're in spats over Dokdo Island (Takeshima) with JP.

    nah, Indian posters mix up business and politics again. businesses would decide where to pour their money on its merits rather than be politics-driven. they're going after investor-friendly environment and profits NOT bon homie at the state level. that's why Ford or Walmart prosper in China not in India.

    do they care Abe and Modi are bhai bhai?

    sometimes I'm wondering if Indians here are so anxious to take down China that u disregard some fundamentals.

    ~Tapa talks: Orange is the new black.~
     
  19. Srinivas_K

    Srinivas_K Senior Member Senior Member

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    Indians have no plans for that .... we would like to compete ... simple as that !
     
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  20. Satybharat

    Satybharat Regular Member

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    Display FAB is on the way....you will here about it soon...
     
  21. Abhijeet Dey

    Abhijeet Dey Regular Member

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    India to be a parallel manufacturing hub to China: Ravi Shankar Prasad

    http://telecom.economictimes.indiat...ing-hub-to-china-ravi-shankar-prasad/47920054

    India will emerge as a parallel production hub to China for global markets in electronics manufacturing as the government shifts attention to boost the making of sophisticated, high-technology products in the country, says telecom and IT minister Ravi Shankar Prasad. "There is a surge towards India as a manufacturing destination, and this will only grow," Prasad tells TOI in an interview. Excerpts:

    How crucial is the manufacturing of electronics in 'Make in India' drive?

    We are aggressively pursuing the manufacturing of electronic goods in India because if this is not done now, we may stare at a huge foreign exchange bill in the coming years which can be catastrophic for the economy. India is buying electronic goods at a rapid pace and if we do not start manufacturing the products, the import bill by 2020 is forecasted to be alarming at $400 billion, which will be more than oil import bill.

    China has emerged as a major manufacturing location for electronics and is seen as a factory for the world. Do you think that India has the capacity to match up to our neighbour?

    I want the production of electronics to be at the center-stage of India's manufacturing eco-system. We want India to be a global manufacturing hub for electronics, running parallel to China. We are confident of achieving this task, and it should happen very soon.

    Have the incentives offered by the government yielded any results?

    We are seeing a rush as far as new investments are concerned. Companies are attracted by India's huge domestic consuming market as well as a pro-active government, which believes in transparent decision-making. We have received 72 proposals to the tune of Rs 23,000 crore, of which 42 proposals worth Rs 12,000 crore have already been cleared. Companies that are investing include Korea's Samsung, Germany's Bosch, Japan's Nidec and Panasonic. These are in segments such as electronic components, telecom network equipment, LED, consumer electronics, automotive, solar panels and strategic electronics. We have even brought in medical electronics within the ambit of this sector as 100% FDI is allowed here.
     

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