Wistron to invest Rs 30 billion for second iPhone unit in Bengaluru

Taiwanese contract manufacturer Wistron is looking to invest Rs 30 billion to setup a second integrated smartphone manufacturing unit for Apple's iPhones on the outskirts of Bengaluru.

The plant, for which the company is looking to acquire 43 acres of land in Narasapura, around 50 kilometers east of Bengaluru, will employ around 10,500 people, according to a statement issued by the Karnataka Chief Minister's office on Tuesday.

Unlike Wistron's first plant located in the Peenya industrial layout in Bengaluru, which Apple uses to manufacture its low-cost iPhone SE and 6S models, the new unit will manufacture a wider range of Apple's devices, according to sources.

Gururaj A, country head of Wistron, was quoted in the statement saying that the new unit would be the biggest project of its kind in the country. He added that the company was also looking to expand the unit in the future.

Welcoming the move, state chief minister H D Kumaraswamy asked the company to submit a proposal for acquiring the land. According to state revenue minister R V Deshpande, the state can sign a memorandum of understanding (MoU) for allotment of the land within seven days.

Business Standard had reported in March that the government of Karnataka had agreed to allocate 43 acres of land to Wistron in Devanahalli, which was north of Bengaluru. Since then, the state has seen the formation of a new coalition government led by Kumaraswamy of JD (S). 

At the time, it was said that Wistron would not use the plant just to assemble smartphones, but also would bring in a consortium of Taiwanese manufacturers who would manufacture the components that go into these devices, locally. Over time, Wistron had said it would also like to expand the plant as and when demand of devices went up.

Apple which is looking to grow its share in the Indian smartphone market is looking at local manufacturing to avoid paying higher taxes on fully imported devices. The technology giant currently controls just around 3 per cent of India’s smartphone market which is overwhelmingly dominated by Google’s Android powered devices.

While Apple's low-cost iPhone SE has been manufactured in the country for sometime now, the company did not officially lower the price of the devices. However, experts say that even this would not have boosted sales of the iPhone SE which comes with a 4-inch screen that’s not favoured by Indian customers.

Apple has been seeking tax sops from the Centre to shift manufacturing of iPhones to India, but so far its efforts have not borne any fruit. The company has also repeatedly been targeted by the Ministry of Information Technology for not allowing users to install an app that will allow them to easily report spam calls and messages.

The US tech giant has maintained that the app will infringe on a user’s privacy by granting access to their calls and messages.