Contract electronics maker Inventec Corp (英業達) has set up a plant in India, but has not started operations due to a taxation issue involving one of its major clients and the local government.
The company, whose clients include Apple Inc and Xiaomi Corp (小米), yesterday said it has decided to leave the plant idle until the issue is resolved and it is seeking other clients to place orders.
“We can not start operating the plant while a major client has taxation issues with the local government,” an Inventec official, who declined to be named, told the Taipei Times.
The official said the about US$10 million plant was set up in India’s Chennai in Tamil Nadu state in the second quarter of last year to help one of Inventec’s US notebook computer clients meet Indian Prime Minister Narendra Modi’s “Make in India” policy.
The company initially installed one production line for the notebook client, the official said.
However, at the end of last year the US client decided to suspend the manufacture of products at the plant due to the Indian state government’s revised tax policy, the official said.
Currently, there are not sufficient orders from other clients to support the full operation of the plant, as most clients are cautious about the unpredictable global economy, the official said.
The official said that the company does not have plans to give up the Chennai plant, rather it is seeking other clients to jointly explore business opportunities, she said.
An industry source, who refused to be named, as the company is in the final stage of deciding whether to set up a manufacturing plant in India, said complicated tax policies in different Indian states is one of the key issues stalling its decision.
“A main issue in India is that each state has different tariff policies and regulations. It is complicated if you want to manufacture products in this state and sell them in other states,” the source said by telephone.
Taiwan’s Department of Investment Services said tax policies, infrastructure and labor efficiency are the three main reasons Taiwanese manufacturers entered the Indian market.
The cultural and language differences and the instability of electricity supply raise the bar for Taiwanese manufacturers to invest in India, department Director-General Vivian Lien (連玉蘋) said.
“Although the investment environment in India is improving, it is still unfriendly to investors, compared with other Southeast Asian countries,” Lien said by telephone.
France cannot afford to ignore the third credit-rating reduction in less than a year, French Minister of Finance Roland Lescure said. “Three agencies have downgraded us and we can’t ignore this cloud,” he told Franceinfo on Saturday, speaking just hours after S&P lowered his country’s credit rating to “A+” from “AA-” in an unscheduled move. “Fundamentally, it’s an additional cloud to a weather forecast that was already pretty gray. It’s a call for lucidity and responsibility,” he said, adding that this is “a call to be serious.” The credit assessor’s move means France has lost its double-A rating at two of the
AI BOOST: Although Taiwan’s reliance on Chinese rare earth elements is limited, it could face indirect impacts from supply issues and price volatility, an economist said DBS Bank Ltd (星展銀行) has sharply raised its forecast for Taiwan’s economic growth this year to 5.6 percent, citing stronger-than-expected exports and investment linked to artificial intelligence (AI), as it said that the current momentum could peak soon. The acceleration of the global AI race has fueled a surge in Taiwan’s AI-related capital spending and exports of information and communications technology (ICT) products, which have been key drivers of growth this year. “We have revised our GDP forecast for Taiwan upward to 5.6 percent from 4 percent, an upgrade that mainly reflects stronger-than-expected AI-related exports and investment in the third
Mercuries Life Insurance Co (三商美邦人壽) shares surged to a seven-month high this week after local media reported that E.Sun Financial Holding Co (玉山金控) had outbid CTBC Financial Holding Co (中信金控) in the financially strained insurer’s ongoing sale process. Shares of the mid-sized life insurer climbed 5.8 percent this week to NT$6.72, extending a nearly 18 percent rally over the past month, as investors bet on the likelihood of an impending takeover. The final round of bidding closed on Thursday, marking a critical step in the 32-year-old insurer’s search for a buyer after years of struggling to meet capital adequacy requirements. Local media reports
RARE EARTHS: The call between the US Treasury Secretary and his Chinese counterpart came as Washington sought to rally G7 partners in response to China’s export controls China and the US on Saturday agreed to conduct another round of trade negotiations in the coming week, as the world’s two biggest economies seek to avoid another damaging tit-for-tat tariff battle. Beijing last week announced sweeping controls on the critical rare earths industry, prompting US President Donald Trump to threaten 100 percent tariffs on imports from China in retaliation. Trump had also threatened to cancel his expected meeting with Chinese President Xi Jinping (習近平) in South Korea later this month on the sidelines of the APEC summit. In the latest indication of efforts to resolve their dispute, Chinese state media reported that
RSS