Apple Inc could produce one in four iPhones in India by 2025, according to analysts at J.P. Morgan, as the tech giant shifts some production from China amid rising geopolitical tensions and stricter quarantine measures due to COVID-19, accroding to Reuters.
It seems that the concentration of production of almost all IT products in China and Taiwan worries not only the US and Eurozone governments but also individual companies. Against the background of the rather aggressive actions of the PRC, any instability in the region will hurt supply chains and prices for electronics.
It has already been reported that Apple plans to start production of the Apple Watch and MacBook in Vietnam, other production facilities will also move outside of China.
By the end of 2022, Apple is expected to shift about 5% of iPhone 14 production to India, the world’s second-largest smartphone market after China. It is also predicted that by 2025, about 25% of all Apple products, including the Mac, iPad, Apple Watch and AirPods, will be manufactured outside of China. Now this figure is only 5%.
Apple began manufacturing iPhones in India back in 2017 through Wistron and later through Foxconn, under the Indian government’s local manufacturing initiative. Currently, such Taiwanese suppliers as Hon Hai and Pegatron are playing a key role in the move to India. Going forward, Apple is expected to qualify local Indian suppliers. Bloomberg earlier reported that the Indian conglomerate Tata Group is in talks with Wistron to create a joint venture to assemble the iPhone.
At the same time, it became known yesterday that the Indian government has increased financial support for new semiconductor plants to be established in the country, and intends to cover up to 50% of their construction costs. In addition, the maximum allowed investment to stimulate the production of displays was abolished. India expects at least $25 billion investment in this industry.
Even before the announcement, last week India’s oil and metals conglomerate Vedanta and Taiwan’s Foxconn signed an agreement with the state of Gujarat to invest $19.5 billion to set up semiconductor and display factories.
These are all kinds of thick hints to China about where the continuation of aggressive rhetoric and behavior can lead it. It seems that in the West they are beginning to understand little by little that it is possible to talk to dictatorships only from a position of strength.