Apple Inc and its main manufacturing contractor Hon Hai Precision Industry Co are still betting on India. When Hon Hai — known globally as Foxconn Technology Group — revealed through an exchange filing last week that it was putting another US$1.5 billion into its operations there, it would have calmed a few nerves in New Delhi.
Worries about the future of Apple in the country had been set off by US President Donald Trump, who said last month that he had told the company’s chief executive officer Tim Cook that “I don’t want you building in India.”
This seemed to contradict hopes, shared by Cupertino, California, and New Delhi, that most iPhones for the US market would come from India by the end of next year.
However, on the ground, Apple’s turn to the South Asian nation seems well-entrenched. Reports have emerged of a new Foxconn campus meant to house 30,000 employees — the largest such effort in India’s recent history — and that another contract manufacturer, Tata Electronics, is now assembling the iPhone 16 in its South Indian plant.
Yet chief executive officers and politicians might have begun to realize that the difficulties involved in shifting — or duplicating — an entire manufacturing ecosystem extend beyond placating Trump. This is a complex environment, and there are severe obstacles to moving it out of China. US politics is only one, though perhaps the loudest.
Admittedly, Apple has had a lot of success in India already. That is why even Trump’s talking about it. In just the last year, the value of its products manufactured there has jumped 60 percent, to US$22 billion. More than US$17 billion is exported; thanks to Apple, India’s US$38 billion of electronics exports now earn more than even its world-famous pharmaceutical sector. No other investment has produced anything near this scale of return. In fact, it might be the only success of Indian Prime Minister Narendra Modi’s pivot to industrial policy in the middle of his decade in power.
This rare win happened, because Apple and its suppliers were committed to moving production into India, and because both federal and state governments rewrote regulations and permissions to help them make the move. Politicians kept up this support, even when there might be a price to pay. After a border clash between China and India in 2020 that killed 20 of its soldiers, Indian officials restricted investment from Beijing. Those restrictions have slowly softened since then, primarily to ensure that Apple’s contractors did not get caught up in red tape.
That experience should have served as a reminder to New Delhi that attracting an entire ecosystem needs three sets of players to cooperate: the companies, the destination market for their products and the source geography. Apple and Foxconn might be on board; Trump and his tariffs might be managed — but what of China?
A recent book by the former Financial Times journalist Patrick McGee argues that Apple in China, and Foxconn in particular, grew because US investors and engineers helped. That is no surprise. Any industrial power trains its competitors and successors. That is what the UK did for the US centuries ago. The financiers, engineers and suppliers that make up an existing manufacturing ecosystem need to be willing and able to cooperate in creating a new one. They are generally well rewarded for it.
Apple’s contract manufacturers and component suppliers, large and small, in China might be willing to set up shop in India — after all, profits are profits wherever they are earned. Some of their engineers might be happy to move to supervise new shop floors.
However, it turns out, Beijing might not permit that to happen. Many crucial, experienced employees have found themselves forbidden to travel to India and Southeast Asia. Apple and New Delhi have tried to woo Trump, and make him accept the possibility that iPhones destined for the US would be made in India. However, they might need to woo Chinese President Xi Jinping (習近平) as well.
Objectively, India’s Apple-led mobile phone ecosystem is nowhere near challenging China’s manufacturing dominance. China is, after all, the indispensable country not just for Apple, but for multiple companies struggling to shift production to India, Vietnam and elsewhere. However, Beijing now appears to view Apple’s India project as a risk — dangerous enough that a few barriers should be erected in its path. Trump, Apple, New Delhi and Beijing appear agreed on Indian manufacturing’s potential over the next few years, whatever the rest of us might think.
Mihir Sharma is a Bloomberg Opinion columnist. A senior fellow at the Observer Research Foundation in New Delhi, he is author of Restart: The Last Chance for the Indian Economy. This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
When US budget carrier Southwest Airlines last week announced a new partnership with China Airlines, Southwest’s social media were filled with comments from travelers excited by the new opportunity to visit China. Of course, China Airlines is not based in China, but in Taiwan, and the new partnership connects Taiwan Taoyuan International Airport with 30 cities across the US. At a time when China is increasing efforts on all fronts to falsely label Taiwan as “China” in all arenas, Taiwan does itself no favors by having its flagship carrier named China Airlines. The Ministry of Foreign Affairs is eager to jump at
The muting of the line “I’m from Taiwan” (我台灣來欸), sung in Hoklo (commonly known as Taiwanese), during a performance at the closing ceremony of the World Masters Games in New Taipei City on May 31 has sparked a public outcry. The lyric from the well-known song All Eyes on Me (世界都看見) — originally written and performed by Taiwanese hip-hop group Nine One One (玖壹壹) — was muted twice, while the subtitles on the screen showed an alternate line, “we come here together” (阮作伙來欸), which was not sung. The song, performed at the ceremony by a cheerleading group, was the theme
Secretary of State Marco Rubio raised eyebrows recently when he declared the era of American unipolarity over. He described America’s unrivaled dominance of the international system as an anomaly that was created by the collapse of the Soviet Union at the end of the Cold War. Now, he observed, the United States was returning to a more multipolar world where there are great powers in different parts of the planet. He pointed to China and Russia, as well as “rogue states like Iran and North Korea” as examples of countries the United States must contend with. This all begs the question:
Liberals have wasted no time in pointing to Karol Nawrocki’s lack of qualifications for his new job as president of Poland. He has never previously held political office. He won by the narrowest of margins, with 50.9 percent of the vote. However, Nawrocki possesses the one qualification that many national populists value above all other: a taste for physical strength laced with violence. Nawrocki is a former boxer who still likes to go a few rounds. He is also such an enthusiastic soccer supporter that he reportedly got the logos of his two favorite teams — Chelsea and Lechia Gdansk —
RSS