Under its strategy to move some production away from China, Apple Inc has been touting India as its next big growth driver. The addition of an Indian iPhone is likely to add momentum to Apple’s efforts to diversify its product base beyond China and build up technology manufacturing in the South Asian nation.
In order for its execution, Tata Electronics Pvt Ltd (TEPL), the Tata Group’s manufacturing arm, is acquiring Wistron’s operations in India for $125 million (Rs 1000 crore). That will make it the first Indian company to manufacture Apple iPhones.
According to the reports, the Wistron Corp which was making iPhones in India agreed to sell its Karnataka manufacturing unit to the Tata Group.
Wistron is the third Taiwanese player in India after Pegatron Corp and Foxconn Technology Group, which began assembling iPhones in India in 2017.
Apple has been assembling iPhones in India for over half a decade under Wistron, Foxconn, and Pegatron. However, with Wistron set to exit the iPhone business in India, TEPL will be the first Indian company to produce iPhones, by acquiring a 100% stake in Wistron.
This Wistron purchase would spur the next cycle of investment in the Indian electronics manufacturing ecosystem and signal the maturing of the country’s contract manufacturing companies.
TEPL is a wholly owned subsidiary of Tata Sons. It was set up to lead the group’s ambitions to become a scaled mobile phone and component contract manufacturer.
The Union Minister of State for Electronics and Technology, Rajeev Chandrasekhar owes this project to the Govt of India’s Product-linked Incentive (PLI) scheme. The government has encouraged electronics makers to build factories in India for domestic as well as international shipments.
Tata Group making iPhones in India should provide a significant boost to Indian Prime Minister Mr. Narendra Modi's "Make in India" initiative while also helping persuade other global electronics brands into considering India as an alternative to China for manufacturing products and diversifying their production base.
With the Wistron's acquisition by TEPL, the Indian stock market can witness a sharp surge in the share price of Tata Elxsi which is a leading design and technology service provider for automotive, broadcast, communications, healthcare, and transportation, under Tata Group.
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