Wistron, Foxconn plan to invest Rs 7,500 cr over five years in India

The company estimated in its proposal that the investment would provide employment to over 10,000 people.

Global electronics contract manufacturers Wistron and Foxconn plan to invest a combined Rs 7,500 crore over five years to expand their production facilities in India.

“Wistron is expected to begin manufacturing iPhone 8 in the country, while Foxconn’s plans are to support higher levels of manufacturing of existing clients such as Xiaomi and Nokia phones,” a person aware of the proposed investments told ET.

Between the two Taiwanese companies, Wistron has applied to the government to invest Rs 5,000 crore and Foxconn Rs 2,500 crore under an incentive package that will likely give these companies benefits of Rs 1,000 crore and Rs 500 crore, respectively.

The government has so far approved as many as 193 of the 421 applications received under the modified incentive package scheme (M-SIPS), of which 144 have started incurring investments totalling Rs 9,252 crore.

“In December alone, the government received 146 applications with a proposed investment of Rs 43,140 crore under the scheme,” an official told ET. “Barring two mega projects, we have received applications of over Rs 1 lakh crore for 421 applications till December 31, the last date.”

Wistron is looking to move some of its PC, Internet of Things, medical and cloud service businesses to India. The company has two plants near Bengaluru that assemble Apple’s iPhone SE and iPhone 6S devices for sale in India.

The company estimated in its proposal that the investment would provide employment to over 10,000 people, according to people aware of the plan.

In the backdrop of escalating trade tensions between China and the US, companies with US clients are scouting for locations to minimise the impact of the tariff war.

“There are two committees which are currently looking into the matter, the appraisal committee and the approval committee. Both are inter-ministerial committees and applications which are of this size need to be ratified by both the committees, so final approval can take some time,” another senior official told ET.

Foxconn’s application to invest Rs 2,500 crore came in December. The world’s largest contract manufacturer recently flagged its concerns to the government over delays in refunds of about Rs 1,000 crore under the goods and services tax regime, saying one of its key India units has been left cash-starved and this could hurt plans to deepen local production of electronics.

M-SIPS is available for both new projects and expansion plans. The scheme provides capital subsidy of up to 25% for units engaged in electronic manufacturing and reimburses countervailing duties/excise duty to attract investments in electronic manufacturing.

For some high capital investment projects including semiconductor wafer fabrication facilities, it provides for reimbursement of central taxes and duties. The investment threshold varies from Rs 1 crore to Rs 5,000 crore, depending on the type of project. The incentives are available for 10 years from the date of approval.




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