The development of India into a major smartphone production base has sparked increased concerns across Chinese social media that mainland China is at risk of losing its primary role in Apple‘s manufacturing supply chain.
That sentiment intensified last week on reports that Apple supplier Foxconn Technology Group plans to invest about US$700 million on a new plant in India to boost local production, signifying an accelerated shift of production away from China amid escalating tensions between Beijing and Washington.
“Foxconn is the weather vane of the manufacturing industry,” online economics influencer Gengbaixingjun wrote on Monday in a post on Chinese microblogging service Weibo, where he has more than 600,000 followers.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
“[The company] not only creates many jobs directly, but also indirectly drives many industrial [supply] chains,” Gengbaixingjun said, adding that Foxconn’s latest initiative in India has made the South Asian country a rival to China in terms of electronics contract manufacturing.
Rajeev Chandrasekhar, India’s Union Minister of State for Electronics and Information Technology addresses a press conference in New Delhi on September 22, 2021. Photo: Hindustan Times via Getty Images alt=Rajeev Chandrasekhar, India’s Union Minister of State for Electronics and Information Technology addresses a press conference in New Delhi on September 22, 2021. Photo: Hindustan Times via Getty Images>
Other netizens on Monday also expressed their apprehensions about the potential shift of Apple’s manufacturing supply chain away from China. Weibo user Miguyuegeqian questioned whether Foxconn would move all of its factories to India, while another user Woniuxingdetuibian posted that it was a “pity” so many businesses are moving to India.
Such anxiety has only intensified amid senior Indian government officials’ public statements on how the country would become a major base for electronics manufacturing.
Rajeev Chandrasekhar, India’s Union Minister of State for Electronics and Information Technology, said over the weekend that mobile phones will be one of the country’s top 10 products for export by next year, up from zero in 2014, according to a report by local news agency Asian News International.
The report also quoted Chandrasekhar as saying that Prime Minister Narendra Modi has laid out a vision that “India will be a significant player in the global electronic supply chain”, with a target of US$300 billion worth of electronics produced by 2026.
Senior Indian government officials’ confidence in attracting more electronics manufacturing to the country reflects the damage done to China’s reputation by Taiwan-based Foxconn’s recent troubles on the mainland.
Foxconn, formally known as Hon Hai Precision Industry, scrambled to restore full production capacity at its manufacturing complex in the central city of Zhengzhou, home to the world’s largest iPhone factory, following severe disruptions that included worker protests that turned violent and the exodus of tens of thousands of employees amid a Covid-19 outbreak that started last October.
In February, senior officials of central Henan province went on a charm offensive in a meeting with Foxconn chairman and chief executive Liu Young-way. They assured the Taiwanese firm that the government will provide comprehensive “services” to its local operations.
While production in Zhengzhou has resumed to about 90 per cent of full capacity as of December 30, there are signs that Foxconn has significantly slowed recruitment for its manufacturing complex in the city. The firm last month revealed plans to build a smart warehouse on a leased plot inside the Zhengzhou Comprehensive Bonded Zone.
The rivalry between China and India has already prompted many mainland social media users to search for comparisons on how the two countries fare as assembly sites for Apple’s products.
A search of “Foxconn India” on Weibo showed the top post on Monday was a video showing how slow an Indian worker tapes a box.
Weibo user Lijingpandaoy questioned whether quality can be ensured at Indian factories. Another user commented that Indian labour costs might be lower than in China, but the South Asian country lags behind in terms of efficiency.
Still, other Chinese netizens regarded Foxconn’s efforts in India as a result of fair competition. “It’s [Foxconn’s] decision to invest [wherever they want],” Weibo user Biteweida wrote in a post. “We don’t need to beg them to stay. Let’s just do our best for those who stay.”
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.
Source: https://finance.yahoo.com/news/chinas-social-media-sounds-alarm-093000754.html