The decision of Foxconn, Taiwan (the largest electronics contract manufacturer in the world) to expand its operations into India is a significant step in the right direction. It gives a much needed boost to 'Make in India' campaign and geopolitically very relevant due to a multitude of factors:
a) Reducing dependency on China, currently the sole supplier - A strategic decision for global brands like Apple and Sony.
b) Demand for newly found sources of rare earth elements (new mines are challenging Chinese monopoly over rare earth elements, a major constituent of electronic components, thereby extending the supplier base and increasing buyer's bargaining power).
c) Help India reduce current account deficit as electronic goods' import factors in as a major contributor to foreign exchange outflow from India, the others being Oil and Gold.
d) A robust electronics export market would bring in much needed foreign capital and help strengthen the broader Indian financial sector.
e) Though job creation is inherent through such massive investments, an endeavour of this magnitude would prompt many Indian youth to train themselves in Electronics and Manufacturing Technologies, who otherwise would be more inclined towards a career in Software and IT enabled services. This could serve as a catalyst for turning India into an innovation hub for the IoT (Internet of Things) revolution, serving a market of 1.3 billion prospective customers.
f) Help India grow as a major economy in Asia and position itself as a deterrent to monopolization of trade in this part of the world and beyond.
- Vinod Geeachan
News source (The Hindu, 08 Aug 2015): Foxconn to invest $5 billion in Maharashtra, gets 1,500 acres for plant
a) Reducing dependency on China, currently the sole supplier - A strategic decision for global brands like Apple and Sony.
b) Demand for newly found sources of rare earth elements (new mines are challenging Chinese monopoly over rare earth elements, a major constituent of electronic components, thereby extending the supplier base and increasing buyer's bargaining power).
c) Help India reduce current account deficit as electronic goods' import factors in as a major contributor to foreign exchange outflow from India, the others being Oil and Gold.
d) A robust electronics export market would bring in much needed foreign capital and help strengthen the broader Indian financial sector.
e) Though job creation is inherent through such massive investments, an endeavour of this magnitude would prompt many Indian youth to train themselves in Electronics and Manufacturing Technologies, who otherwise would be more inclined towards a career in Software and IT enabled services. This could serve as a catalyst for turning India into an innovation hub for the IoT (Internet of Things) revolution, serving a market of 1.3 billion prospective customers.
f) Help India grow as a major economy in Asia and position itself as a deterrent to monopolization of trade in this part of the world and beyond.
- Vinod Geeachan
News source (The Hindu, 08 Aug 2015): Foxconn to invest $5 billion in Maharashtra, gets 1,500 acres for plant