Tata Sons have chosen Tamil Nadu as its base and are seeking up to $1 billion through overseas loans to set up a mobile phone and component manufacturing plant to make Iphone parts, The Economic Times has reported.
The partnership with Apple Inc. will be part of Prime Minister Narendra Modi’s Make In India push.
This move is an initiative by the group chairman N Chandrasekaran who wants mobile makers such as Apple to have alternative production sites in India as they try to leave China.
The Tata Group will avail the benefits made available under the PLI (Production-Linked Incentive) scheme launched by the Modi government aimed at turning India to a global electronics manufacturing powerhouse.
According to the ET report, Tata Sons plan a capital expenditure of $1.5 billion for building manufacturing capacity in this area and is trying to secure $750 million to $ 1 billion in external commercial borrowings and the remaining through internal accruals.
The new production unit is expected to fulfil Apple’s sourcing needs and may eventually scale to meet the requirements of other original equipment manufacturers from South Korea and Japan.
Last month it was reported that Tata Group is investing ₹5,000 crores to set up a phone component manufacturing plant at the industrial complex in Hosur, Tamil Nadu that also happens to border with IT hub Bangalore.
The new company, Tata Electronics, has been allotted 500 acres by Tamil Nadu Industrial Development Corporation (TIDCO) and will be manufacture components for Apple, which is looking to diversify its sourcing base from China.
Titan Co Ltd’s precision engineering division, Titan Engineering and Automation Ltd (TEAL) will provide the expertise for this project with a staff strength of 18,000 by October 2021 and 90 per cent of it will be women.
Tamil Nadu government recently unveiled the Tamil Nadu Electronics Hardware Manufacturing Policy 2020 and has a target to increase electronics industry output to $100 billion by 2025 aiming to contribute 25% of India’s total electronic exports.