What you need to know
- India is reportedly planning to offer Apple and Samsung suppliers subsidized loans.
- It is hoped the initiative will tempt new suppliers to open factories in the nation.
- The country also plans to set up industrial zones with taxation and customs clearances and infrastructure.
A report suggests that India is planning to offer Apple and Samsung suppliers subsidized loans in the hope that they will open factories in the nation.
According to Bloomberg, a government official revealed the plans, which are set to be announced on February 1 as part of the new federal budget.
According to the report:
The proposals by the Ministry of Electronics and Information Technology includes offering interest subsidy on local borrowing by manufacturers, may form part of the federal budget to be unveiled on Feb. 1, the official said, asking not to be identified citing rules on speaking to the media. It also includes setting up of industrial zones equipped with taxation and customs clearance, along with infrastructure such as roads, power, and water supply, the official said.
India currently makes around $24 billion worth of phones but hopes to multiply that to $190 billion by 2025. Apple already makes some iPhones in India and has apparently pledged to increase its presence in the nation over the next five years. One of its main suppliers, Foxconn, already has two factories in the south of the country where it makes devices for Xiaomi and Nokia. Given trade tensions between the US and China, the report notes that this could give manufacturers the opportunity to diversify their manufacturing efforts away from China.
If the proposals are taken forward, India will shift its export focus North towards Europe and the US.