Make in India: PM Narendra Modi to urge LG, Samsung to setup plants in India

KOLKATA: Prime Minister Narendra Modi will meet top executives at Samsung and LG during his trip to South Korea early next week to push the Korean chaebols to set up semiconductor manufacturing plants in India which, among other thinks, can boost local manufacturing of cellular phones.

Minister for communication and IT Ravi Shankar Prasad confirmed that Modi will meet LG and Samsung officials at the "highest level" during his visit "to attract more investment under the Made in India policy." He added, "Earlier, I had personally met senior executives of these companies and we expect something concrete now."

Modi’s agenda includes meeting with Samsung Electronics’ president and head (IT and mobile communications business) JK Shin who is also a director on the parent company’s board and widely considered the most important executive at the firm. At LG Electronics, Modi will have a meeting with the firm’s global CEO and vice-chairman Bon-Joon Koo, who is from the promoter family and is the founder’s grandson.

The PM is tipped to pitch the country as the next manufacturing hub for cellphones and semiconductor facility, to these two chaebol, a senior executive with one of them said, requesting anonymity, as the matter is confidential. Setting up a semiconductor plant along with downstream units entails more than $2-3 billion of investment.

"Only when a semiconductor facility is set up, it will usher in a complete revolution in cellphone manufacturing in India since a cellphone or electronic product can then be manufactured from the component level as compared to the current scenario when the models and components are mostly imported in completed knock down format and then assembled in India," he said.

LG India’s managing director Soon Kwon said Modi’s visit will enhance bilateral ties. He, however, declined to share any details of the PM's business engagement with Korean companies.

A Samsung India spokesperson was not available for comments. The government has been trying to attract semiconductor or manufacturing in India, but without much success.

The UPA government had made several pitches to Samsung and LG to invest in India to set up semiconductor facility but with no success in the latter part of its tenure.

Samsung is one of the world’s leading semiconductor firms and even supplies chips to rival Apple’s iPhone. LG too is reviving its semiconductor business and has acquired Korean firms.

India is among the fifth largest market for LG and the country’s largest white goods maker operates two plants here.

The country’s second largest MNC and smartphone market leader, Samsung operates two plants and is planning to set up its third unit in India which will manufacture appliances, televisions and smartphones.