A top government official has revealed that India does not expect major service interruption at Foxconn after the company ordered its Chinese employees at the company’s Indian operation to return home over the past few months.
This comes as the iPhone assembler reportedly ordered hundreds of engineers from mainland China to return from its Indian operations in July. Despite this apparent setback, the Indian government has so far not noticed any challenges associated with the directive at Foxconn.
Foxconn has managed well despite orders for staff from China
Secretary of India’s Ministry of Electronics and Information Technology Shri S. Krishnan told reporters in Taipei that the company has managed to keep its head above water with some of the employees from various factories complementing each other.
“Although some of the Chinese workers had to leave because they were asked to return, operations did not really suffer significantly,” said Krishnan during a visit to a trade show in Taiwan.
“Foxconn has been in their plant near Chennai for the last five years and a new plant is coming up near Bengaluru. So they were able to manage with some of the workers there, some people from Taiwan, and some people from the United States.”
Krishnan.
Formally known as Hon Hai Precision Industry, the company asked hundreds of its Chinese employees to return to China. Together with its client Apple, they have been looking at ramping up iPhone production in the country to offset the adverse impacts of US President Donald Trump’s tariff threat on Chinese goods, which is on hold as the two economic superpowers negotiate a trade deal.
Foxconn has previously cautioned investors that the US tariff threats could weigh on future performance.
While Washington and Beijing earlier agreed to a 90-day truce on new duties, the pause still fell short of a comprehensive trade deal, leaving the company vulnerable to potential tariff hikes that could hamper its China-based assembly operations.
The development comes as most of the iPhones that Foxconn makes for Apple are assembled in China. Now, the company has reported that Q3 server sales are set to double, while iPhone assembly revenue slows down.
Foxconn looks beyond semiconductors and smartphones
According to Krishnan, it is not clear why staff from China were asked to return home. Tensions between India and China escalated in 2020 after a military clash along their disputed Himalayan border.
In response to this, India imposed restrictions on Chinese investments, banned hundreds of popular Chinese apps and cut air passenger routes between the two countries.
However, tensions between the two countries have gradually thawed in recent months as Indian Prime Minister Narendra Modi held high-level engagements with Chinese President Xi Jinping in August during his first visit to China in seven years.
“Our understanding is that Foxconn stands committed to see through all the investments in India … their expansion in India has been very significant,” Krishnan said.
Beyond semiconductors and smartphones, Foxconn earlier indicated that it was actively pursuing growth in the electric-vehicle (EV) sector as Cryptopolitan previously reported.
The company is also looking at giving more attention to AI server production in the US to avoid biting tariffs from the US-China trade conflict. Already, Foxconn lowered its full-year revenue outlook back in May because of geopolitical risk.
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Source: https://www.cryptopolitan.com/india-remains-upbeat-about-foxconn/