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Tata Group is in discussions with Taipei's Wistron Corp, one of Apple Inc's top vendors in India, to buy its manufacturing facility in Karnataka for up to 5,000 crore ($612.6 million), suggested a report by The Economic Times.

Wistron began making iPhones in India in 2017, after years of efforts by Apple to add manufacturing capabilities in the country. The Taipei-based company currently assembles iPhones at its plant in the state of Karnataka in southern India.

In September, Bloomberg News had reported that Tata Group is in talks with the Taiwanese supplier to Apple Inc. to establish an electronics manufacturing joint venture in India, seeking to assemble iPhones in the South Asian country.

If successful, the pact could make Tata the first Indian company to build iPhones, which are currently mainly assembled by Taiwanese manufacturing giants like Wistron and Foxconn Technology Group in China and India.

An Indian company making iPhones would be a massive boost for the country’s effort to challenge China, whose dominance in electronics manufacturing has been jeopardized by rolling Covid lockdowns and political tensions with the US. It could also persuade other global electronics brands to consider assembly in India to reduce their reliance on China at a time of increasing geopolitical risks.

Tata Group Chairman Natarajan Chandrasekaran has said electronics and high-tech manufacturing are key focus areas for the company, India’s top conglomerate with revenue of about $128 billion. Industries such as software, steel and cars account for much of Tata’s business, but it has taken early steps in the smartphone supply chain by starting to manufacture iPhone chassis components in southern India.

For Wistron’s Indian business, struggling with losses, a pact with Tata would give it a formidable local partner with deep pockets. Tata’s reach also spans automobiles including electric vehicles, an area many of the world’s tech giants are eager to expand in, as per the Bloomberg report.

Wistron InfoComm also recently emerged as the single biggest investor under the government’s production-linked incentives (PLI) scheme for large-scale electronics manufacturing, bringing in 1,250 crore, followed by the local units of Samsung and Foxconn, investing 900 crore and 650 crore, respectively. The government launched the scheme in March 2020 to encourage manufacturing and create jobs.

 

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