As labour costs rise in China, Apple supplier Foxconn doubling down on India with US$5 billion investment

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Amid rising labour costs in China, Foxconn, the world's largest contract electronics maker, has been exploring automation and moving operations overseas. Photo: AP

Published: 2:29pm, 10 Aug 2015

As Chinese and western smartphone makers and other tech firms target India's growing middle class, Foxconn – the world's biggest contract electronics maker – is due to invest as much as US$5 billion in Maharashtra state.

Foxconn's operations in the state will employ more than 50,000 people, Maharashtra industry minister Subash Desai told the Times of India.

The investment will be the largest of its kind in the state and will also help boost prime minister Narendra Modi's "Make in India" campaign, which aims to turn the sub-continent into a manufacturing powerhouse.

READ MORE: Foxconn’s Foxbot army close to hitting the Chinese market, on track to meet 30 per cent automation target

Other foreign firms are also investing in the country, South Korean steelmaker Posco previously committed over US$12 billion to build a plant in Odisha state, while Chinese device maker Huawei recently got approval to begin manufacturing in India.

Foxconn is also in talks with other states to set up manufacturing units and forge possible partnerships in the world's fastest growing smartphone market, the report said.

Maharashtra and Foxconn officials signed a memorandumw of understanding outlining the deal over the weekend, Foxconn said in a statement.

The Taiwanese firm said it has significant plans for India, which it sees as a key part of its "Industry 4.0" smart manufacturing plan.

Foxconn's India expansion comes as labour costs in mainland China, where it has long based the bulk of its operations, are on the rise.

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