One of the best ways through which Apple is trying to limit its dependence on China is the expansion of iPhone Production in India. But as suggested by a recent report, the local officials and small farmers could complicate the survival of Cupertino Company.
Particularly, it implies that purchasing the land for more Apple assembly plants may prove risky.
Background:
We have been threatened for many years about the trouble and demand of decreasing Apple’s reliance on China, but the Pandemic clearly enhanced the chances of the company to have its most productive industries in a single place. The company had to pay a billion dollars per week due to the COVID-19- disruption that happened at the world’s biggest iPhone assembly plant.
The supply chain of Apple is progressively expanding, along with the assembly plants in Indonesia, Vietnam, India, and somewhere else. But the dependence of the iPhone is excessively on China. Latest evaluations denote that the country still supplies 95% of the entire iPhone yield—nearly 80% of all the iPhones are manufactured at an exclusive plant in Zhengzhou.
Speculative expansion of iPhone Production in India:
Anyhow, there is relatively a huge hindrance: conflict between National and Local government, and the viewpoint of small-scale landholders.
There are three ranks of government: local, state, and national. The three groups were found in a continuous battle, which was provoked by the fact that the local government gets more and more power. Although the national government wants to promote the growth of its manufacturing economy, the local government is frequently opposing new developments because it is focusing on the protection of existing land use. In particular, protecting small-scale landholders like farmers from the mandatory purchase of orders by the National government is the job of the local government.
Philip Elmer Dewitt spotted a Bloomberg report that stated:
“Realizing this promise probably relies on India chipping away at the historic barriers to doing business there. Difficulties moving things in and out of the country, rivalries between various parts of government, and tax, labor, and land policies have all led to India being ranked lower than other Asian countries where electronics manufacturing takes place […]
Anupam Manur, an assistant professor at the Takshashila Institution, a public policy organization in India, says India continues to grapple with overcomplicated policies in areas such as labor law and taxes. One important indicator, he says, is whether India is able to overhaul its policies on the acquisition of land. This is a key part of any industrial project, and the process has consistently generated conflict in India.
Small landowners may not be interested in giving up their farms to make room for a sparkling phone factory, and local officials see their control over land policies as a way to exercise their leverage.
Manur says things are moving in the right direction, but he’s wary of getting too confident: “Any point in the last 30 years, I could have told you we were on the brink of cracking it.”