The Karnataka government is in talks with Apple and its contract manufacturing partners to deepen its manufacturing ecosystem in the state by expanding the existing facilities and bringing in more component suppliers. The goal is to create a more robust ecosystem that can make products beyond iPhones.
"Foxconn is here, and so is Wistron. Naturally, we want to attract more Apple partners to deepen the supply chain. Without the supply chain, it becomes expensive for them. So, if we want to reduce costs of the final products, even when it's going to be shipped abroad, you need to ensure that the entire ecosystem is there," state IT Minister Priyank Kharge told Moneycontrol in an interaction.
Apple's partner Tata Electronics makes iPhones in Karnataka at the Wistron factory it acquired last year. It has been producing iPhones in the state since 2017. Foxconn, a more prominent Apple partner by volume, and Pegatron make iPhones in Tamil Nadu. The state is now paving the way for Foxconn's entry into Karnataka.
Foxconn Technology Group chairman Young Liu visited Bengaluru in August and met Chief Minister Siddaramaiah and Kharge to discuss the company's upcoming facility near the Kempegowda International Airport, which will also assemble Apple's iPhone.
The new factory, also known as Project Elephant, will be Foxconn's largest smartphone manufacturing plant outside China. Foxconn has secured 300 acres of land in the ITIR Industrial Area, which spans Doddaballapura and Devanahalli Taluk in Bengaluru Rural District. This project, estimated at Rs 22,000 crore, is expected to generate over 40,000 jobs.
"Quite naturally, I'm here to bring the entire ecosystem with them. So if we have an A, we will also get a B, a C, and a D. So, we want to focus on everything from packaging to higher-up the value chain for component manufacturing because 1,000 components get into that. So we are looking at, working aggressively, on that and we've been extremely successful so far," he added.
The minister said that companies like Foxconn and Tata are original equipment manufacturers (OEMs) and can make products for several companies. "So, let us say they start making products with some other companies… It is a matter of time."
Apple is significantly ramping up its iPhone manufacturing capabilities by producing iPhone 16 Pro and Pro Max models and making further efforts to produce other category products, including AirPods and iPads.
Moneycontrol reported on July 8 that the company may resume preparations for manufacturing its iPads in India, encouraged by the government's push to attract more supply chains to the country.
Apple is also looking to increase the production of components for AirPod wireless charging cases through Jabil in India. AirPods will be the second product category after the iPhone to be made in India. Apple's AirPods lead the TWS (true wireless stereo) market globally.
The central government wants Apple to look into making laptops and desktops in India in the coming years.
GCC and SpaceTech Policies
Karnataka will bring in a dedicated policy for Global Capability Centers (GCCs) on September 27, and it will be the first Indian state to have such a system in place. The government plans to provide plug-and-play facilities beyond Bengaluru for companies planning to open GCC in the state.
"The talent request is coming from the GCC. So, we will be skill-ready so that they become productive and profitable as soon as possible. We'll be reducing the gestation period for production, productivity, and profitability, and also we'll have many plug-and-play facilities beyond Bengaluru," he said.
In Mysuru, the state is developing a plug-and-play facility that will allow companies to set up a small GCC with 50 employees for a couple of years to test the possibilities and then scale it up, if necessary.
The state is also planning to introduce a space tech policy by the first quarter of next year and is experimenting with In-Space, and has approved a centre of excellence (CoE) to be set up for this.
Kharge said the government is focusing more on downstream space technology to use space technologies in sectors like agriculture, horticulture, and disaster management. "Downstream is something that we are very aggressive on, and we are pushing that. Space-tech itself is what we are pushing."
The state government is promoting startups in the space-tech segment and has funded several of them, including Bellatrix Aerospace. "We are trying to see how we can push space technology, MSMEs, component manufacturing, and all those things beyond research and development," he added.
While cautious, the minister said the state is looking at various cases of use of artificial intelligence (AI) to solve real-life problems, including improving government processes and e-governance.
"I haven't seen an actual use case of Gen AI for the government or that will help solve a real-life problem as of now, but it's extremely glamorous. People are loving it. People are using it for animation, graphics, and creating music," he said. "We're looking at AI as a much more serious thing."
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