Mumbai – Apple iPhone manufacturer Foxconn has agreed to invest $5 billion on a new plant in the western Indian state of Maharashtra, a government official said Saturday, in a major boost for Prime Minister Narendra Modi.
The Taiwanese firm’s chairman Terry Gou signed a memorandum of understanding with Maharashtra’s chief minister Devendra Fadnavis in India’s financial capital of Mumbai.
“Extremely elated to witness the signing of 5 billion dollar MoU between GoM (government of Maharashtra) & Foxconn with employment generation of 50,000”, Fadnavis wrote on Twitter.
The investment on the new manufacturing facility will take place over five years.
The Apple supplier, also known as Hon Hai Precision Industry, is the world’s largest computer components manufacturer and also assembles products for Sony and Nokia.
Setting up a facility in India could help cut Foxconn’s labour costs and boost sales of iPhones in a country that boasts 952 million mobile connections.
In June, Maharashtra’s industry minister Subhash Desai told AFP that Foxconn was in talks with the Indian government to build a plant in the state as the business-friendly Modi seeks to boost foreign investment in Asia’s third-largest economy.
Desai had said local officials had pitched several possible sites to the Taiwanese technology giant.
Modi swept to power at elections in May 2014 pledging to attract overseas businesses to the country as he promised to inject life into a stuttering economy .
He later launched his “Make in India” campaign which aimed to send a message to the world that India was open for business.