Sunday, September 26, 2021

Chinese Tech Giant Xiaomi Wants To Turn India Into Global Manufacturing & Export Hub

Chinese tech giant Xiaomi has announced it will be setting up more smartphone manufacturing plants in India in collaboration with local companies BYD and DBG. Xiaomi says it wants to turn India into a global manufacturing and export hub.

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The facility owned by DBG in the northern state of Haryana is already operational. Another plant in Tamil Nadu would be operational by June this year. The third plant for manufacturing television sets has been set up in partnership with Radiant Technology in Telangana.

Xiaomi India Head and Global Vice President Manu Jain said in a statement: “We hope to play a small role in building India as a global manufacturing hub.”

Xiaomi, in partnership with Foxconn and Flex, already has several manufacturing plants for smartphones and TV. With new production units, the tech giant will be able to manufacture over 99 percent of its smartphones and TV sets it sells in India.

Jain said India could become an export hub for Xiaomi in the future. The company had last year exported products from India to Nepal and Bangladesh. After meeting 100% local demand, the company will move to increase exports.

While the demand for smartphones and smart TVs is robust, the company is aiming to reap the benefits of the government’s production-linked incentive (PLI) scheme by sourcing devices from local contract manufacturers.

The government’s PLI scheme is aimed at enhancing India’s manufacturing capabilities and enhancing exports across 10 sectors. None of the Chinese companies have been able to make it to the list under PLI, but Xiaomi is finding ways to benefit through companies that have been awarded 4-6% incentive on production value.

Despite the border tensions between India and China, the company has remained bullish, Jain said. There had been a huge backlash in India with a demand to boycott Chinese products in the wake of the Galwan Valley clash between Indian and Chinese troops last June. India lost 20 of its soldiers, while China recently admitted that four PLA personnel were also killed in the incident.

In the aftermath of the bloody face-off, the bilateral trade between the two countries had seen a dip but Xiaomi seemed to have escaped unscathed.

Since then, the Modi government has been pushing the self-reliance ‘Atmanirbhar Bharat’ initiative to stop dependency on Chinese goods. Citing security concerns, more than a hundred Chinese apps were also banned. With the disengagement in the Pangong Tso now over, the two countries might go back to mend their ties.

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