By Arun Nair
Foxconn Technology Group has asked over 300 skilled Chinese engineers and technicians to return home from its iPhone factories in India, in a development seen as more than just a routine reshuffle of manpower. The stoic silence by both Apple and Foxconn have added further concern among experts. The development comes at a time when Apple was preparing to ramp up production of its next flagship iPhone in India. While it’s not immediately clear why Apple’s biggest iPhone assembler sent the workers home, the company’s move coincides with growing tension between Beijing and Western tech firms over their “China plus one” strategy, and the border tensions between India and China. The development is a huge setback for Apple, which has invested heavily in expanding its manufacturing footprint in India. The company had spent a huge money in training these engineers in assembling devices, and also in transferring decades of process knowledge built inside Chinese mega-factories. Is China Slowly Trying to Tighten It’s Grip? The development is seen as an attempt by the Chinese government to stop the outflow of talent, technology, and equipment. According to Bloomberg, the Chinese government has unofficially urged companies and regulators to stop the export of key equipment and restrict the movement of skilled labour to destinations like India and Southeast Asia. ALSO READ: Foxconn Pumps $1.5 Billion Into India Unit as Apple Eyes China Plus One Shift This, experts say, is Beijing’s counter to the “China plus one” strategy being adopted by multinationals to hedge against geopolitical risk. China, which enjoys a monopoly in the supply of rare earth magnets, had restricted its exports in retaliation for to trade war with the US. The shortage in supply of the critical minerals, widely used in electric vehicles, has exposed automakers to the threat of shutdowns. Foxconn In India By quietly withdrawing engineers and making the movement of skilled labour more difficult, China has hit the very foundation of India’s electronics ambitions. Though the extraction won’t impact the quality of production in India, it may bring down efficiency on the assembly line, Bloomberg reported quoting company officials. According to Bloomberg, Indian authorities were informed of the withdrawal but weren’t given the reason behind such a move. There has been no formal disruption in iPhone production yet, but officials are monitoring the situation closely. The clampdown comes at a time when Foxconn, which still produces the bulk of iPhones in China, was gradually expanding its assembly lines in India, making the latter its second home for high-end production. In 2024, Apple assembled a record $10 billion worth of iPhones in India, of which about $7 billion were exported, mostly to the US. India now accounts for nearly 20% of Apple鈥檚 global iPhone output. The California-headquartered company was planning to produce its latest model, the iPhone 17, in India. The withdrawal of the Chinese workforce is likely to affect the quality, efficiency and training are expected to suffer. Foxconn’s Chinese engineers played a critical role in setting up India’s assembly lines, sharing their years of expertise from Shenzhen’s highly optimised factories. The removal of Chinese workers from India is expected to slow down the training of local workforce as well as the transfer of manufacturing technology from China, likely raising production costs, Bloomberg reported. The sudden vaccum is expected to bring a huge challenge to India’s new recruits who will not be expected to help produce devices that require over a thousand individual components to be assembled with microscopic precision. China Clampdown Retaliation To App Ban? India and China’s diplomatic relations have remained fractured since the 2020 Galwan Valley border clash. Since then, New Delhi has taken a large number of symbolic steps like banning apps like TikTok and curbing Chinese investments in telecom and power. Despite public sentiment, China remained India’s largest import partner, with over $101 billion in imports in FY24, according to India鈥檚 commerce ministry. Get Latest News live on Times Now along with Breaking News and Top Headlines from Business, Companies and around the world.