Committed to investing $5 billion in Maharashtra: Foxconn

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Foxconn already has a project near the Mumbai-Pune expressway.

Foxconn, the world’s largest contract manufacturer, has said that it will keep its commitment of investing $5 billion in Maharashtra, as outlined in a memorandum of understanding (MoU) signed in 2015.

The company executives spoke to officials in the Maharashtra government including industries minister Subhash Desai on Friday morning and reiterated their intention to invest in the state, and to ensure creation of 50,000 jobs by 2020, as per the terms of the MoU.

“We will fulfil our commitment that we made back in 2015, and we are committed to the state,” said Simon Hsing, official spokesman of Taiwan-based Foxconn, which was earlier known as Hon Hai Precision Industry Co.

“After this week – the Chinese New Year – we will share our action plan with the minister. Our investment is towards business operations in electronic manufacturing, but we need to have good communication with government officers so they don’t get any incorrect impression that we are not committed,” he said.

Foxconn had signed an MoU with the Maharashtra government in August 2015 to set up a large mobile phone and phone parts manufacturing factory over 1,500 acres near Mumbai-Pune expressway. At that time, it was the single largest proposal of foreign direct investment in western India. However, since then the company has not made any formal announcement of investment in the country or the state.

“Foxconn has not come and I feel as bad as you do. But we do not regret it; we are discussing with other companies,” the state industries minister Subhash Desai said on Thursday, indicating that the Taiwanese contract manufacturer might go back on its promise to invest in the state.

Meanwhile, Foxconn’s India manufacturing arm – Rising Stars Mobile India Pvt Ltd – has set up factories in Sri City, Andhra Pradesh and Sriperumbudur, Chennai, to make mobile phones and television panels respectively.

“We have been doing investments. Our investments are not for announcement but rather for a business operation for our customers,” Hsing said.

Foxconn India’s head of operations, Josh Foulger, had said in December 2016 that the company had invested about $600 million till then, including its investments in e-commerce platforms Hike and Snapdeal. The India arm is mulling expansion to several other states including Maharashtra, with a Navi Mumbai plant.

People aware of the development said that FIH Mobile Ltd, the key manufacturing arm of the Foxconn Technology Group, has invested almost $100 million (Rs 634.3 crore) in the Indian operations in January this year, through Wonderful Stars, a wholly-owned subsidiary of FIH based out of Singapore. The investment was disclosed to the Taiwan and Hong Kong stock exchanges on January 4.

Besides the local investments, the leading supplier to Apple and maker of the iPhone in China is looking to invest Rs 6,000 crore to set up a 200-acre plant in the special economic zone (SEZ) of the Jawaharlal Nehru Port Trust (JNPT) near Mumbai, ET had reported in December last year.

Foxconn makes nearly 15 million phones a year in India for companies such as Xiaomi, Nokia, Gionee and InFocus. It makes smartphones and feature phones for Nokia, while the rest of the brands source smartphones from it. The local arm plans to double capacity in India this fiscal and is already scouting for locations to set up more plants.

ET had reported last year that Foxconn’s India arm was evaluating areas within the Nokia SEZ in Sriperumbudur, besides locations in Maharashtra and Delhi-National Capital Region, among various options. A greenfield unit in Navi Mumbai to make mobile phones and other products is also being planned, entailing an initial investment of $20-30 million.

The company is also considering starting exports to West Asia and Africa from India and has begun talks with suppliers to set up base in the fastest growing smartphone market in the world so that they can feed into the production chain for local and export markets. This is where investment in a port would fit in.

[“Source-economictimes.indiatimes”]