Google wants to make Pixel smartphones in India
India's desire to become a manufacturing powerhouse is slowly taking shape. Global tech giants are now eyeing the country as an alternative to China. Google is the latest company seeking to set up a production base in India. According to Bloomberg, it is in conversation with Indian suppliers to assemble its Pixel smartphones in the country. The discussions are still going on.
Why does this story matter?
China has been the go-to destination for global tech giants when it comes to manufacturing. However, the past few months have shown signs of the country losing its place as the center of the global supply chain. Now, countries like India that lurked in China's shadow have emerged as viable alternatives. India has lofty ambitions for the future as a manufacturer.
Google wants to make use of PLI scheme
Google is in talks with multiple companies in India, including Lava International Ltd., Dixon Technologies India Ltd., and Foxconn's Indian arm Bharat FIH. The firms Google is in conversation with have won the production-linked incentive (PLI) scheme. The PLI scheme was launched to boost local production. Google's rival Apple has also used the scheme to increase its production in the country.
Apple has ramped up its production in India
Google's decision to move a part of Pixel production to India is an emulation of what Apple has done. The Cupertino-based tech giant's iPhone production in the country grew from 1% in 2021 to about 7% now. The company has roped in its chief assembly partners from Taiwan to build devices in India. It could move 25% of iPhone production to India by 2025.
iPhone exports from India reached Rs. 10,000 core in May
In May 2023, the total smartphone exports from India was Rs. 12,000 crore. Out of that, iPhones made up Rs. 10,000 crore. In April and May, iPhones accounted for 80% of total smartphone exports from the country.
The worsening US-China relationship has affected companies' outlook
China's crippling pandemic-related lockdowns and its worsening relationship with the US have prompted tech companies to look for alternatives. Leaving China completely may not be possible. That's why companies like Apple are looking to diversify production. Apple has been cautious with its manufacturing plans. Google may also take a similar approach in moving its production beyond the Chinese borders.
