Shortly after Xiaomi stated that it would continue to invest in India, Indian media reported that the number of employees of Xiaomi India had decreased from 1,500 to about 1,000, which showed that Xiaomi began to counterattack India strongly. Industry insiders pointed out that the impact of this move is far more than that , the result is likely to lead to the disillusionment of the dream of making in India.
1. Xiaomi opens the curtain for India's mobile phone manufacturing industry
Xiaomi entered India in 2017 to cooperate with Foxconn to build a factory, but before that, Foxconn has always planned to set up a factory in India, but Foxconn has not been successful, and the so-called $5 billion investment plan has not been implemented for a long time. , This made the Indian media once questioned Foxconn's drawing cakes for India.
In fact, it is not that Foxconn does not want to go to India to set up factories, but the environment in India is quite complicated, which has caused Foxconn and other foreign-funded enterprises to face many difficulties in setting up factories in India. Although India has previously proposed a strategy of making in India, it lacks a manufacturing base. Foreign-funded enterprises are hesitant to set up factories in India.
After Xiaomi and Foxconn set up factories in India, Xiaomi quickly developed into the largest mobile phone company in India, which attracted Chinese mobile phones to set up factories in India. Some Chinese mobile phone companies even expressed that they would set up the largest factory outside of China in India, and make the mobile phones produced in India Mobile phones are sold to the Middle East, Africa and other places.
The success of Xiaomi has also promoted the progress of Apple and Foxconn in printing and setting up factories. In 2017, Foxconn and Xiaomi cooperated to build factories. In 2019, Foxconn went to the printing and setting factories to manufacture for Apple. It shows that Indian manufacturing has begun to enter a stage of rapid development.
2. The fines of Xiaomi and Chinese mobile phones in India have far-reaching consequences
In the past two years, India has repeatedly taken action against Chinese mobile phone companies, all of which inspected taxes on the grounds of tax issues, causing huge losses to Chinese mobile phone companies. However, India did not expect that its actions would have such a great impact.
Chinese mobile phones have become a major force in the global mobile phone market. During the peak period, Chinese mobile phone companies accounted for nearly half of the global mobile phone market. In addition to India, they sold markets in Europe, the Middle East, Africa and other places. This has led to Chinese mobile phone brands received global media attention.
This time India has taken measures against Chinese mobile phones, especially the heavy punishment of Xiaomi, which has had a far greater impact on the world than before. The European and American media have made in-depth reports on this, and once again let the European and American media find out that India used tax issues as an excuse. Companies that have punished Europe and the United States, such as Nokia, Amazon, Wal-Mart, etc., once again made India's reputation as a foreign cemetery shine globally. .
Such influence, even the Indian consortium Tata's forced acquisition of Wistron, which led to Wistron's announcement to close all Indian businesses and withdraw from the Indian market, has not reached a height, which has exceeded India's expectations.
3. Make in India may be terminated
The strategy of “Made in India” was proposed by Modi, who served as Prime Minister in 2014. After Chinese mobile phones entered the Indian market, “Made in India” really started. However, now that Chinese mobile phones are punished in India, a chain reaction has begun.
In 2022, more than 5,000 foreign-funded companies registered in India have already withdrawn more than 1,700. Since this year, India has tried to attract foreign-funded companies to invest in India. As a result, only one company has decided to invest in India. Previously, the media claimed that Modi’s visit to the United States and talks with Musk will It prompted Tesla to go to India to set up a factory, which eventually came to nothing. Even Foxconn intends to reduce its investment plan in India, and Apple has also returned iPhone 15 production to mainland China. All signs show that foreign companies are becoming more wary of India.
If there are not enough foreign-funded enterprises entering India, then the development of India's manufacturing industry will become empty talk. After all, India has so far lacked an industrial chain, and the level of manufacturing technology is far lower than that of mainland China. In 2022, Apple will hand over to Foxconn to produce iPhones in India. It was pointed out that the yield rate is only 50%, and the low manufacturing level will allow Indian manufacturing to develop at a low level forever and cannot go abroad.
After India took measures against Chinese mobile phones in 2021, India's exports will decline significantly, causing India's trade deficit to expand to a record high of more than 270 billion US dollars in 2022. India's short-sightedness will make India's manufacturing always a castle in the air.