Apple Inc. (NASDAQ: AAPL), a prominent technology company, has emerged as the largest employer in India’s electronics industry, creating 100,000 direct jobs in the past 19 months, according to a report by Business Standard. These employment opportunities were generated through Apple’s vendors and suppliers who manufacture iPhones in India under the government’s Production Linked Incentive (PLI) program.
According to reports, Foxconn Hon Hai, Pegatron, and Wistron, the three companies responsible for assembling the iPhone, have created 60% of the total new jobs in India. These jobs were created due to their participation in the PLI program, launched in August 2021 by the Indian government, to boost the country’s electronics manufacturing industry.
Also, the remaining 40% of the jobs generated by Apple in India were created by the company’s ecosystem, which includes suppliers of various components and chargers used to manufacture iPhones. These suppliers have collectively created an additional 40,000 jobs, and their names include Tata Electronics, Salcomp, Avary, Foxlink, Sunwoda, and Jabil.
Foxconn, Pegatron, and Wistron have already created 7,000 more jobs than their collective commitment for this year. Furthermore, with a month remaining in the financial year, several thousand additional jobs are expected to be created. This suggests Apple’s participation in the PLI scheme empowers India’s workforce by creating new jobs and supporting economic growth.
These companies are critical players in Apple’s supply chain, and their participation in the government’s PLI program has created significant employment opportunities in India’s electronics industry. Moreover, their contributions are critical to the growth and success of Apple’s operations in the country.
Initially, the Indian government had projected that the Production Linked Incentive scheme for smartphones would generate 200,000 direct jobs by 2025. However, with Apple alone accounting for 100,000 jobs by early 2023, the project is on track to exceed this number significantly. Moreover, the success of the program has not only led to job creation. Still, it has also accelerated the growth of the country’s electronics manufacturing industry, making it a more attractive destination for global technology companies looking to expand their operations.
One of the primary goals of the PLI initiative was to generate employment. The scheme offers economic incentives to companies for incremental sales of products made in domestic units. By setting up manufacturing facilities in India, companies are encouraged to create jobs there. Apple, for instance, has moved a portion of its electronics production from China to India, creating numerous manufacturing jobs.
Apart from creating employment opportunities, the PLI scheme also holds strategic significance. Manufacturing electronic products in India reduce the nation’s import expenditure and promotes economic self-sufficiency.
Additionally, producing such electronics in India, similar to countries like South Korea and Taiwan, can be a stepping stone for more sophisticated electronics manufacturing, such as semiconductors and fabs, to eventually take place in India. Therefore, the success of India’s ambitious PLI scheme is critical, and the initial outcomes, especially with regard to job creation, indicate that the scheme is functioning as planned.
Apple suppliers created jobs in India
Foxconn Hon Hai, a Tamil Nadu-based entity, exclusively manufactures iPhones in India. It has created over 35,500 jobs, accounting for over a third of all jobs created by Apple in India. Another Taiwanese electronics major, Pegatron, based in Tamil Nadu, has become the second-largest employer with 14,000 jobs. Wistron, located in Karnataka, has generated 12,800 jobs.
Notably, the Indian government’s PLI scheme has played a significant role in attracting these companies to invest in India and create employment opportunities in the country’s electronics manufacturing industry. As a result, these companies have not only created jobs but have also contributed to the development of India’s economy, making it a more favourable destination for global investors.
Business Standard (BS) reportedly reached out to an Apple spokesperson for comment on these employment numbers but did not receive a response.
Sources in the supply chain told BS that Tata Electronics, a key supplier of mechanical parts to Apple, has employed a significant number of workers. The report further highlights that other significant contributors to job creation in the electronics sector are Salcomp, with over 11,000 employees, and Jabil, Foxlink, and Sunwoda.
In an October 2020 press release, the government estimated that the smartphone PLI scheme would create two lakh direct jobs over five years.
The government’s estimate suggests that for every direct job created in electronics manufacturing, nearly three times the number of indirect jobs are generated. Therefore, the total number of direct and indirect jobs created by the Apple ecosystem is likely to be around three lakhs.
The India Cellular and Electronics Association has reported that mobile device manufacturers and their suppliers have created around two million jobs, both directly and indirectly, over a period of seven years.
Bottom Line
The Cupertino giant became the first company in India to export over $1 billion worth of iPhones in December 2022. Between April and December 2022, it exported over Rs 30,000 crore worth of smartphones, accounting for approximately 40% of the total smartphone exports in value from the country.
Apple’s participation in the PLI scheme is not only benefiting its business interests but also contributing to the development of India’s workforce by creating new job opportunities, encouraging local manufacturing, and promoting skill development. This partnership is a win-win situation for Apple and India, strengthening their economic ties and fostering mutual growth and prosperity.
