Foxconn plans to invest big in India, and there is a fierce competition raging between Indian states to woo the Taiwanese electronics giant. The plan is to expand its mobile phone manufacturing, and partner with mining giant Vedanta for semiconductors and display fab early this year. The Taiwanese company is planning to establish an EV plant as well and is exploring states to set up plants for all three.
Currently, the states of Maharashtra, Telangana, and TN are in the race to woo the electronics giant. In contrast to the rumours of the company settling for just one state, insiders say the company might go for different states instead, for various aforementioned sectors. For example, the company already has manufacturing facilities in Tamil Nadu and Andhra Pradesh.
Various states are keen to offer incentives, largely because of three general reasons. First, Foxconn setting up a new plant in any state will make it a major manufacturing hub. Second, it will secure continued investments for decades to come, and third, it will create jobs within the state. While the state incentives will be over and above the Indian government’s production-linked incentives (PLI) for the semiconductor sector.
Amongst the four states, Maharashtra and Tamil Nadu are established manufacturing hubs for automobiles. Haryana is the third most popular automobile manufacturing hub and the state approved a new policy for EVs this year. According to the policy, there will be a 100 per cent reimbursement of stamp duty along with an exemption in electricity duty for 20 years. The state’s EV policy also gives a state GST reimbursement at 50 per cent of the applicable Net SGST for 10 years. In addition, companies that will manufacture EVs, components of EV and EV batteries, and charging infrastructure will be incentivised with capital subsidies.
Last week, Foxconn’s CEO and chairman Young Liu met with Prime Minister Narendra Modi. Liu, with his team, had also interacted with the Electronics and IT (MeitY) minister Ashwini Vaishnav and Minister of State for MeitY, Rajeev Chandrasekhar.