Apple gets a boost in India as Chinese suppliers given clearance

More than a dozen of Apple’s Chinese suppliers have received initial approval from India to expand domestically, boosting the company’s efforts to diversify its assembly network beyond China.

AirPods and iPhone assembler Luxshare Precision Industry Co. and a division of lens maker Sunny Optical Technology Group Co. are among the companies that have received the approval, according to people familiar with the matter. Stated. The approval from a major Indian ministry is a step towards full approval for expanding operations in India, and companies will likely still need to find local Indian joint venture partners, the official said. rice field.

Apple and other U.S. electronics brands are looking to reduce their reliance on China after trade restrictions and Covid-related production disruptions exposed the risks of being too concentrated in one country. Despite escalating political tensions in India, the permits show India is allowing more Chinese companies to build technology manufacturing sectors.

Prime Minister Narendra Modi has made growing India’s manufacturing sector a national priority, providing financial incentives and government support for expansion projects of the companies. Apple, along with partners such as Hon Hai Precision Industry, has played a central role in that effort by domestically producing more of the latest generation iPhones than ever before.

About 14 suppliers have received approval from India after being nominated by Apple to provide the services needed to boost its presence in India, the people said. The majority of Apple products are still assembled in China, but the company has started manufacturing more in India in recent years through partners in Taiwan.

Representatives from Luxshare, Sunny Optical, Apple and India’s Ministry of Technology did not respond to emails seeking comment.

Headquartered in Cupertino, California, Apple tightly controls its supply chain, which consists of hundreds of component manufacturers. Some Indian companies, such as the Tata Group, already supply components to Apple, and the country is pushing to add more local providers to its supply chain to boost and diversify the electronics industry. We do. Joint ventures with Chinese parts manufacturers are a way to make that happen.

India has largely cut off Chinese companies from its tech economy after the two countries’ armed forces clashed violently on their long-disputed border in 2020, leaving at least 20 dead on the Indian side. The incident sparked a surge in anti-Chinese business sentiment in the country.

Since then, India has banned the apps of Alibaba Group Holding, Tencent Holdings and ByteDance, and raided and punished many other Chinese tech companies, from mobile phone makers to fintech service providers. Tightening rules barring companies from bordering countries from entering without government consent, Chinese firms missed out on government incentives for high-tech manufacturers.

Meanwhile, India has steadily stepped up local assembly of smartphones, allowing Taiwanese manufacturers Hon Hai, Wistron and Pegatron to set up factories. However, the lack of significant component manufacturers close to operations limits the growth of the domestic industry.

India has now approved the expansion of some Chinese suppliers in the country, but some are still denied, the official said. Apple has submitted a list of about 17 suppliers to Indian authorities, one of the people said.

According to officials, Han’s Laser Technology Industry Group Co. and Shenzhen YUTO Packaging Technology Co. are licensed.

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