Tata to set a plant for Apple phone components
The Tata group is investing rupees 5,000 crore to set up a phone
component manufacturing plant at the industrial complex in Hosur, Tamil Nadu.
The new company, Tata Electronics, has been allotted 500 acres
by TIDCO (Tamil Nadu Industrial Development Corporation), and the Bhoomi
poja was performed on Tuesday. The investment will be scaled up depending
on the level of sourcing from the facility and could even touch rupees 8,000
crore. The unit will be manufacturing components for Apple because Apple is
looking to diversify its sourcing base from china.
History
Foxconn is already manufacturing handsets, including iPhone 11, for Apple at
its facility in Sriperumbudur, outside Chennai. At the moment, the
iPhone maker contracts Foxconn, Wistron and Pegatron for manufacturing
(only assembly) its phones in India.
Job opportunity
The new unit will have staff strength of 18,000 by October 2021 and 90%
of it will be women.
How suddenly Tata came
The Tata Group, it appears, is taking advantage of the productivity-linked
incentive scheme that the Modi government has announced, to deepen India’s
electronics manufacturing base including achieving self-sufficiency in
manufacturing of mobile handsets.
(What is PLI scheme
It would give incentives of 4-6% to electronics companies which
manufacture mobile phones and other electronic components such as transistors,
diodes, thyristors, resistors, capacitors and nano-electronic components such
as micro electromechanical systems.
According to the scheme, companies that make mobile phones which sell
for Rs 15,000 or more will get an incentive of up to 6% on incremental sales of
all such mobile phones made in india. In the same category, companies which are
owned by Indian nationals and make mobile phones, the incentive has been kept
at Rs 200 crore for the next 4 years.)
Role of Titan
Titan Co Ltd’s precision engineering division, Titan Engineering and
Automation Ltd (TEAL), wil provide the expertise for this project. With a 27.88%
stake in titan Co Ltd, TIDCO is the single largest shareholder in
the watchmaker. 2nd largest shareholder is TATA SONS Pvt. Ltd.
With 20.84% stake.
Tamil Nadu pips Karnataka
There was intense competition between states for bagging this project. In
the end Tamil Nadu pipped Karnataka to seal the deal. What worked to Tamil Nadu’s
advantage appears to be its Favourable policies and the presence of companies
like Foxconn, flex, Samsung, Dell, Nokia, Motorola and BYD to a few.
The state government recently released the Tamil Nadu electronics
hardware manufacturing policy 2020 and has set an ambitious target to increase
electronics industry output to $100 billon by 2025.it envisages the state
contributing 25% of India’s total electronic exports by that
year.
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