Foxconn to receive Rs 6,970 crore for iPhone unit expansion
Foxconn, the renowned Taiwanese contract manufacturer and primary supplier for Apple, is poised to receive a substantial incentive of Rs 6,970 crore as part of Karnataka’s special incentive scheme aimed at fostering growth in the Electronics System Design and Manufacturing (ESDM) sector from 2020 to 2025. The announcement was made by Chief Minister Siddaramaiah during the state budget presentation on March 7.
The Devanahalli Industrial Area in Karnataka is set to witness the establishment of a cutting-edge mobile phone manufacturing plant by Foxconn, with an initial investment of Rs 21,911 crore. This significant venture will be complemented by an incentive of Rs 6,970 crore under the ESDM policy, as highlighted by the Chief Minister in his budget address.
In his statement, Chief Minister Siddaramaiah reiterated the importance of this development, stating, “Foxconn is setting up a mobile phone manufacturing plant in Devanahalli Industrial Area with an investment of Rs 21,911 crore and will be provided incentives under the ESDM policy.”
Empowering Growth Through Strategic Incentives
The ESDM policy extends a range of incentives to encourage growth and investment in the electronics manufacturing sector. These incentives include a 25% capital investment subsidy on land, a 20% subsidy on plant and machinery, and full reimbursement of stamp duty, registration charges, and land conversion fees provided by the state government. Foxconn’s receipt of such a substantial incentive signifies a landmark achievement, positioning Karnataka as a frontrunner in fostering high-end electronics manufacturing.
The introduction of the Karnataka Employer’s Compliance Decriminalisation and Digitisation Bills further underscores the government’s commitment to creating a conducive environment for economic growth and job creation. Chief Minister Siddaramaiah emphasized the pivotal role of sectoral policies in IT, tourism, and biotechnology in driving economic progress within the state.
Revamping Bengaluru’s Infrastructure
In response to mounting public criticism regarding Bengaluru’s inadequate infrastructure, Chief Minister Siddaramaiah unveiled a series of measures aimed at bolstering the city’s foundation. The announcement comes on the heels of the impending Bruhat Bengaluru Mahanagara Palike (BBMP) elections, underscoring the government’s dedication to enhancing basic infrastructure critical for economic prosperity.
To facilitate the implementation of crucial infrastructure projects and effectively manage allocated funds, a new Special Purpose Vehicle (SPV) will be established. This strategic move seeks to reallocate responsibilities for major development initiatives away from BBMP, which has faced scrutiny over the city’s deteriorating infrastructure.
Moreover, the budget outlines plans to extend the Metro line from Kempegowda International Airport to Devanahalli, with a vision to introduce 98.6 km of new metro routes within the next two years. Progress has been reported on the long-awaited Peripheral Ring Road (PRR) project, with specialized teams currently engaged in land acquisition efforts. A budget of Rs 27,00 crore has been earmarked for the construction of a 73 km PRR, now christened the ‘Bengaluru Business Corridor,’ with financial backing from HUDCO Bank.
Additionally, the redevelopment of the Majestic bus stand in Bengaluru through a public-private partnership (PPP) model is set to transform it into a modern transportation hub and commercial complex, catering to the evolving needs of the city’s residents and visitors.
By fostering strategic partnerships, incentivizing growth, and prioritizing infrastructure development, Karnataka is poised to enhance its economic landscape and reinforce its position as a hub for innovation and progress.