Recently, as Indian media cited anonymous sources, that the Indian law enforcement agency arrested three executives of Vivo India Company on charges of alleged involvement in a money laundering case.

As per The Times of India, the individuals arrested by the Indian law enforcement agency in this case are Hong Xuquan, the interim CEO of vivo India, along with Harinder Dahiya, the CFO of Vivo India, and the company consultant Hemant Munjal.

The three have been taken into custody under the provisions of the Prevention of Money Laundering Act (PMLA). Reportedly, an ED spokesperson did not immediately respond to a request for a comment. Furthermore, the Vivo employees is said to be appear in court on December 26.

Vivo spokesperson has responded accordingly that, “We are deeply alarmed by the current action of the authorities. The recent arrests demonstrate continued harassment and as such induce an environment of uncertainty amongst the wider industry landscape. We are resolute in using all legal avenues to address and challenge these accusations.”

According to The Times of India, in October of this year, the Indian law enforcement agency arrested four individuals, including Vivo’s chartered accountant Nitin Garg.

The report further states that from 2014 to the present, Vivo India has been allegedly probing suspicious transactions, which were remitted by the company to China from Rs 1.25 lakh crore of receipts from its Indian operations since 2014

“Various Chinese nationals have been traveling across India, including sensitive places of Jammu and Kashmir and Ladakh, in gross violation of Indian visa conditions.” the agency added.

Previously, as per  Hindustan Times, the Indian government banned numerous Chinese apps, accusing them of being “prejudicial to the sovereignty and integrity of India, defence of India, security of the state and public order.” Since June 2020, more than 200 Chinese apps, including popular ones such as TikTok, WeChat, and UC Browser, have been banned.

The government has also stated in its parliament indicating that, Chinese smartphone makers, including Xiaomi, Realme, Oppo, and Vivo, have been found evading taxes to the tune of Rs 9,000 crore in India.

(Photo credit: Vivo)

According to a news report from Financial Times, Apple has reportedly informed its supply chain, including battery suppliers such as China’s Desay Corporation and Taiwan’s Simplo Technology, of its inclination to shift the battery supply for the iPhone 16 to India. Apple is encouraging suppliers to relocate existing production capacity to India to expand production scale in the region.

TrendForce believes that, given the critical nature of battery components in terms of user safety, any error in battery assembly is unacceptable. As Apple’s certainty about production yields in India remains unclear, this move carries certain risks.

Apple Expedites iPhone Assembly Business Transfer to India to Mitigate Geopolitical Risks

As the world’s most valuable company, Apple’s supply chain strategy has always been a key factor in its success. Amidst geopolitical tensions between the U.S. and China, Apple faces significant pressure from both the investment community and U.S. policymakers to diversify its supply chain, prompting an acceleration in the transfer of iPhone assembly operations.

In recent years, Apple has been shifting part of its iPhone assembly business from China to India to mitigate production risks.

The choice of India as a manufacturing destination is influenced not only by its large and untapped population but also by proactive subsidy policies implemented by the Indian government, aiming to position India as an attractive manufacturing and export hub for multinational companies.

Additionally, the growth potential of the iPhone in the Indian market adds to the appeal of relocating iPhone production to India. 

Increased Risks as Battery Component Production Shifts to India amid Uncertain Yield Rates

Analyzing the manufacturing distribution for Apple’s iPhone 15 series in 2023 reveals Foxconn’s predominant role, with only specific Plus models being produced by India’s Tata Group.

This strategic move, based on TrendForce’s insight, is inferred to be influenced by the Plus models’ lower sales performance in previous generations and their specific product positioning. Apple seems cautious about shifting production to India entirely until the production standards of Indian manufacturing facilities are confirmed, especially for models with comparatively lower demand.

In the ever-evolving landscape of smartphone components, such as core processors and camera modules, upgrades occur almost annually. However, the upgrade pace for smartphone batteries has been notably slower.

This delay is attributed to the critical importance of safety in battery components. Given the potential risks to user safety, even a minor error in battery components could lead to significant harm to a smartphone brand.

Considering this, the manufacturing distribution for Apple’s iPhone 15 series suggests that Apple might not be entirely confident in the production yield rates in India.

If the decision to shift the production of batteries, which requires a special emphasis on safety, to India is solely driven by the need to mitigate geopolitical uncertainties, it indeed poses a certain level of risk for Apple.

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• [Insights] Tata’s Challenge in Securing Large iPhobe Orders After Officially Acquiring Wistron’s India Factory

Apple’s iPhone is gaining even more popularity in India, with Tata Group, India’s conglomerate, reportedly preparing to build a new iPhone assembly plant. According to Bloomberg, this move aligns with Apple’s broader manufacturing strategy expansion in India.

Previously reported by TrendForce, Apple’s decision to opt for India is primarily due to the fact that since 2015, India has become the fastest-growing regional market for smartphones globally. Earlier in October this year, Tata Group officially acquired Wistron’s subsidiary in Bengaluru, primarily responsible for assembling orders for the iPhone 14. 

According to sources from Bloomberg, Tata Group is not only recruiting new staff for this facility but also planning to build the largest iPhone assembly plant in the town of Hosur, Tamil Nadu, India.

The new facility is expected to establish 20 assembly lines, planning to employ approximately 50,000 workers within the next 2 years. It is slated to be operational within 12 to 18 months. However, the existing government-supported PLI (Production-Linked Incentive) fiscal incentives will expire around the time of operation. Therefore, Apple and Tata Group may seek new subsidies from the government for the production of the new iPhones.

Apple has been actively expanding in India, and the new iPhone assembly plant is a crucial strategy for both companies. For Apple, it serves to diversify the supply chain risk by gradually shifting the assembly of iPhones from China to India. Meanwhile, Tata Group aims to expand its traditional business scope.

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• Tata Group to Become the Fourth iPhone Assembler as Production Relocation Accelerates
• [Insights] Tata’s Challenge in Securing Large iPhobe Orders After Officially Acquiring Wistron’s India Factory

(Photo credit: Apple)

India could see at least three more semiconductor fabrication units coming up in the next few months with cumulative investments to the tune of USD 8-12 billion, Union Minister for Electronics and Information Technology Ashwini Vaishnaw said on Tuesday.

India is working hard to get big semiconductor companies to build chip plants in the country with its $10 billion semiconductor program. Global semiconductor giants are considering making factories in India driven by the need to diversify supply chains beyond China and the big demand for tech talents in India.

According to Deccan Herald’s report. At the unveiling of AMD’s global design center in Bengaluru on November 28th, Ashwini Vaishnaw, Union Cabinet Minister for Railways, Telecommunications, Electronics and Information Technology of India, briefed journalists on ongoing negotiations with several local governments to determine precise locations in the following months.

AMD’s global design center plans to host around 3,000 AMD engineers in the coming years, focused on the design and development of semiconductor technology including 3D stacking, artificial intelligence, machine learning, and more. Vaishnaw pointed out that AMD setting up its biggest design center is strong evidence of how much global companies trust India. Besides, Vaishnaw highlighted the achievement of Micron’s semiconductor plant project, which was revealed in June and started construction in September. He said the success of Micron’s initial facility in India has boosted confidence globally.

Apart from global giants’ investment in India, the minister also told about the Semiconductor Lab (SCL) progress in Mohali, mentioned significant headway in the Expression of Interest (EoI) process. He anticipates finalizing matters within the next 5-6 months. The lab is planned to serve as both a research and semi-commercial facility.

The Indian government asserts that a comprehensive microprocessor chip manufacturing initiative is on the horizon in the country. Anil Agarwal, Chairman of Vedanta, anticipates the launch of “Vedanta chips made in India” by 2025, reported by icbank on weixin.

The government envisions establishing a “semiconductor city” in Dholera, Gujarat, covering an area equivalent to Singapore, with Prime Minister Modi expressing confidence in attracting both domestic and international giants to set up manufacturing plants despite the remote location.

The tech hub in Bangalore has played a pivotal role in India’s ascent as a global participant in the semiconductor network, primarily through chip design. Over the past two years, substantial government subsidies have transformed India into a hub for electronic product manufacturing.

India’s Challenges abound in the Actual Chips Manufacture

Despite initiatives like the “production-linked incentive measures” encouraging mobile assembly in India since 2020, chip manufacturing remains a formidable task.

Presently, nearly all cutting-edge chips are produced in Taiwan, with China’s chip investments surpassing those of India. Vedanta Group’s Agarwal plans to kickstart chip manufacturing within two and a half years, extending invitations to global chip manufacturing experts.

While today’s cutting-edge chips are predominantly manufactured in Taiwan, TSMC has even established a fab in Arizona with the assistance of the U.S. “Chip Act.”

India lacks a historical presence in chip manufacturing and faces a shortage of highly skilled engineers and equipment. Nevertheless, the government aims to achieve what companies like TSMC took decades to accomplish through substantial spending and capital investment promotion. However, China’s significant investments in domestic chip manufacturers, following the U.S. ban tightening China’s semiconductor development last October, far exceed India’s investments in local companies.

With the goal of establishing India’s inaugural semiconductor foundry, Mr. Agarwal of Vedanta Group aims to commence chip manufacturing within two and a half years, extending invitations to international talents like David Reed and Texas Instruments.

Agarwal aspires to attract around 300 foreign experts from East Asia and Europe to Gujarat. The manufacturing of microchips also necessitates a significant amount of customized infrastructure, with Vrishno, the responsible official, indicating that India’s largest chemical plant near Dholera can produce the specialized gases and liquids required for any chip factory’s operation.
(Image: AMD India)

Foxconn has announced plans to invest over USD 1.5 billion in expanding its facilities in India. This substantial investment, a rarity in recent years, has sparked speculation that Foxconn is preparing for the introduction of new iPhone products in India.

Due to reports suggesting that in the second half of 2024, Apple will initiate the design, development, and trial production process for the iPhone 17 in India, if true, this would mark the first time in iPhone history that a New Product Introduction (NPI) is conducted outside of China, solidifying India as a potential global iPhone production hub.

Foxconn’s subsidiary, Foxconn Hon Hai Technology India Mega Development Private Limited, disclosed the plan to build the factory locally, with an expected investment of INR 128.209 billion (approximately USD 1.537 billion). This move is seen as a strategic effort to enhance iPhone production capacity in India.

According to TrendForce’s estimate, the proportion of iPhones produced in India is still below 10% in 2023, expected to reach 25-30% by 2025, and projected to achieve 35-40% by 2028. TrendForce believes that with the stable production base of Foxconn in India, it can indeed expand the output.

Analyst Ming-Chi Kuo from TF International Securities disclosed that Apple is placing a growing emphasis on the Indian market. The company intends to kick off the NPI process for the standard edition of the iPhone 17, slated for release in the second half of 2025, in India during the latter part of 2024.

Kuo further highlighted that this development signifies the first instance of a new iPhone model being developed outside of China. Choosing the standard version of the iPhone for development lowers the design complexity, reducing risks. This year, 75-80% of iPhones produced in India are manufactured by Foxconn.

According to a previous report by Indian media Economic Times, Foxconn’s factory in Tamil Nadu, India, has been producing the iPhone 15 Plus in the fourth quarter of this year and has already started production of the standard version of the iPhone 15.

Before the iPhone 14, only a small portion of Apple’s phones were assembled in India, with shipments lagging six to nine months behind those in mainland China. However, this year, India has officially entered the supply chain for the initial batch of new iPhones.

Foxconn’s India representative, V Lee, previously stated that the company was “aiming for another doubling of employment, FDI (foreign direct investment), and business size in India” by next year. However, no further details were provided.

In other product areas, there have been recent reports that three subsidiaries of the Foxconn Group will be among the first approved list of incentives for information technology (IT) production in India. Foxconn Group is also accelerating its layout for manufacturing and components in India.

(Photo credit: Apple)