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Apple, Foxconn, and Karnataka Government Collaborate to Boost Manufacturing in India

Apple and its supplier Foxconn have been lobbying for the liberalisation of labour laws in the Indian state of Karnataka, according to a report by the Financial Times. The legislation, introduced earlier this month, allows for 12-hour shifts and nighttime work for women, similar to the practices in China.

The move comes as Apple has been shifting production away from China due to COVID-related restrictions and tensions between Beijing and Washington. The company has been seeking to diversify its supply chain and has been investing heavily in India recently.

Last week, Foxconn announced that it was seeking cooperation in India in new areas like chips and electric vehicles (EVs) after a visit to the country by its chairman, Liu Young-way. The move is part of the company’s expanding business beyond its core contract manufacturing services.

Apple has been ramping up its production in India, with plans to assemble more iPhones there. The Karnataka government recently announced that 300 acres had been set aside for a factory to assemble iPhones. IPhones are assembled in India by at least three of Apple’s global suppliers – Foxconn and Pegatron in Tamil Nadu, and Wistron in Karnataka.

India is an attractive destination for Apple and its suppliers due to its large and growing market and relatively low labour costs. The government has also been offering incentives to companies that invest in the country’s manufacturing sector.

However, the liberalisation of labour laws has been controversial, with critics arguing that it could lead to the exploitation of workers. In addition, introducing 12-hour shifts and nighttime work for women has raised concerns about the impact on workers’ health and safety.

In response to the criticism, the Karnataka government has defended the legislation, saying it will create more job opportunities and help to boost the state’s economy. The government has also said it will ensure the new laws are implemented responsibly and sustainably.

The move by Apple and its suppliers to increase production in India is part of a broader trend of companies seeking to diversify their supply chains and reduce their dependence on China. The COVID-19 pandemic has highlighted the risks of relying on a single country for manufacturing, and many companies are now looking to spread their products across multiple locations.

In addition to India, other countries attracting investment from companies looking to diversify their supply chains include Vietnam, Thailand, and Mexico. These countries offer lower labour costs and favourable business environments, making them attractive alternatives to China.

In conclusion, liberalising labour laws in Karnataka is a significant development that could have far-reaching implications for the Indian manufacturing sector. While some have criticised it, others have welcomed it as a way to create more job opportunities and boost the economy. As Apple and its suppliers ramp up their production in India, it will be interesting to see how this trend plays out and whether it leads to further investment in the country’s manufacturing sector.

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