Samsung last year exported over $52 billion worth of mobile phones and spare parts across the world from Vietnam, accounting for 9 per cent of the country's overall trade. The South Korean giant now produces more than half of its mobile phones in this country.
In striking contrast, the Cupertino-based Apple exported iPhones worth $10 billion from India in FY24, a fifth of what Samsung achieved last year in Vietnam. And it shifted 12 per cent of the iPhone production value from China to India, only a fourth of what Samsung has been able to achieve in Vietnam last year.
The two global tech giants, however, have had one thing in common—their identical search for a new low-cost hub for assembling their phones and moving away from their dependence on China. Samsung's tryst with China started 16 years ago, but labour costs in the country gradually went up and homegrown mobile companies gave the South Korean giant tough competition. Samsung closed their last mobile factory in China in 2019.
But for Apple, which churned out 95 per cent of its iPhone production in China, the decision to hedge their bets and look at an alternative base emanated from growing US-China tensions and trade wars. And in 2020, it chose India, bringing in their three global vendors under the production linked incentive (PLI) scheme for assembling mobile devices.
The gamble has clearly paid off. Apple has beaten its export targets, provided direct jobs, and invested what was committed to the government. The question is whether Apple can do to India what Samsung has done to Vietnam, transforming the small state into a powerhouse of electronics just after China? Last year, Vietnam's electronics exports touched $142 billion, which is nearly five times what India was able to achieve in FY24 at $29.2 billion.
Denne historien er fra October 31, 2024-utgaven av Business Standard.
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Denne historien er fra October 31, 2024-utgaven av Business Standard.
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