(Bloomberg) – India is unveiling a Rs to diversify beyond.
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Prime Minister Narendra Modi is using the early success of Apple Inc.’s local assembly plants – which have helped the US company produce about 7% of its global iPhone production – to position the country as a viable global manufacturing hub. New Delhi is keen to bring more tech production to India after China’s trade war with the US and its strict Covid guidelines have prompted companies to weigh other options.
Apple has yet to start manufacturing iPads or MacBook laptops in India, but new incentives could prompt the Cupertino, California-based company to consider such moves. Other manufacturers that could benefit from the new measures include Dell Technologies Inc., HP Inc. and Asustek Computer Inc.
“India passed a huge milestone in mobile phones last year with exports worth US$11 billion,” India’s Technology Minister Ashwini Vaishnaw told a news conference on Wednesday. “We want to take this momentum with us.”
The plan provides companies with a 5% cashback on the factory prices of finished products. Sourcing components locally will help manufacturers achieve more financial benefits.
In 2021, India launched a Rs.73.5 billion program to boost local manufacturing and increase exports of IT products such as laptops, tablets and personal computers. However, this project was not able to attract any companies because the incentives were felt to be too small.
Chinese manufacturers such as Lenovo Group Ltd. could struggle to win stimulus amid chilly relations with India since a 2020 border dispute in the Himalayas.
(Updates with Minister’s comment in fourth paragraph)
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