Taiwan’s Foxconn Technology Group, the world’s largest contract manufacturer, is aiming to create at least a million jobs by setting up 10-12 manufacturing facilities across India by 2020, its chairman said.
Terry Gou, head of the maker of iPhones and iPads for Apple and Kindles for Amazon, told the media on a short trip to India that Foxconn will look to set up the manufacturing plants, initially in five states including Andhra Pradesh, Gujarat and Maharashtra, and expand to other states across the country within five years.
The company also plans to set up data centres and incubators in cities including Delhi, Mumbai, Bengaluru and Hyderabad. It is also looking to invest in Indian internet startups, small and medium-sized enterprises and handset makers.
“We not just aim to create basic jobs but jobs for skilled manpower in the country,” Gou said. He was in Delhi and Mumbai on Friday and will be in Bengaluru on Saturday on a whistle-stop visit to India.
He said, however, that electricity supply, water, logistics, manpower and different tax regulations are some of the hurdles that the government needs to take care of for Foxconn to establish its factories in the country.
Gou said that the current government is far more supportive of manufacturing in India than the government 10 years ago, when it set up a manufacturing plant in Chennai. Foxconn has had to shut the plant due to continuing labour unrest. The component-making plant was a key supplier to Nokia, which shut operations last year.
The firm, also known as Hon Hai Group, which has a client list that includes Apple, Cisco, Dell, Microsoft and Hewlett-Packard, plans to make mobile handsets, tablets, TVs electronic products, batteries and key electronic components, routers, set-top boxes and printers among other products in India, the top executive said.
Gou said that Foxconn will look at making India a manufacturing hub to not just make products for the consumption of domestic market but to cater to other markets as well.
“We will help local companies and help them design and manufacture components and devices locally, enabling them to start export,” Gou said.
Foxconn will soon start assembling smartphones for Chinese brand Xiaomi in a plant located in Sri City in Chennai, and that it plans to set up 10-12 manufacturing plants with an initial investment of about $2 billion (Rs 12,800 crore). It has already been in talks with a number of Indian, Chinese and multinational handset brands for the production of smartphones in India. Gionee recently confirmed its talks with Foxconn for contract manufacturing in India.
Gou is also meeting a number of internet-based startups, small and medium enterprises, and device manufacturers in India for potential tie-ups and investments under the company’s broader strategy, called Internet Plus.
He said that Foxconn has expertise in content, information processing, cloud and bandwidth, besides hardware. “We will partner with Indian companies to deliver this,” he said.
Gou said he met with executives of a number of Indian enterprises, including Bharti’s Hike Messenger and Snapdeal. However, he didn’t share details of the talks he held with these companies.
Foxconn’s expansion plan ties in with the India push of Japanese telecom and internet company SoftBank. Recently, it tied up with SoftBank and Bharti Enterprises to launch a joint venture in renewable energy that will invest $20 billion (about Rs 1.28 lakh crore) over 10 years.
SoftBank chairman and CEO Masayoshi Son recently said that his group and Foxconn are in talks to form a joint venture for electronics manufacturing in India. The Taiwanese company will lead the venture, with SoftBank playing supporting role. Some industry executives said Bharti Enterprises could also join the two firms.