Foxconn may make $2B mobile phone investment in India

Government-owned telecommunications company mandates its suppliers to locally manufacture mobile phones

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Foxconn International Holdings, the mobile phone arm of the world's largest electronics contract manufacturing company, is planning a major investment in India that could be valued as high as $2 billion.

The Taiwanese company, which produces mobile phones on behalf of clients like Nokia and Motorola, is currently mulling a plan to invest in India, said Michael Lin, an investment relations representative at the company. But the exact amount of the investment has not yet been decided, he said.

However, Ajay Dua, secretary of India's Department of Industrial Policy and Promotion, said Monday at a conference that a Taiwan-based mobile handset manufacturer was keen to set up a manufacturing facility in India, and would likely invest $1 billion to $2 billion.

Such a deal, if it goes through, would likely be a result of an announcement by the government of India that Bharat Sanchar Nigam, a large government-owned telecommunications services company, will make it mandatory for its suppliers to locally manufacture mobile phones either directly or through a contract manufacturer.

Since that decision was handed down, Motorola has announced plans to make phones in India, although the company had earlier said it would manufacture in India only once its sales volumes picked up in the country. Nokia has also said it will manufacture phones in India.

Foxconn International is part owned by Hon Hai Precision Industry Co., which produces electronics goods ranging from game consoles to personal computers for clients worldwide.