Xiaomi, a Chinese handset maker has established its first ever SMT plan in collaboration with its Taiwanese manufacturing partner, Foxconn, to begin PCB assembling in Sriperumbudur, Tamil Nadu.
The new SMT plant is a part of Xiaomi’s new campus in Tamil Nadu which also houses a new smartphone unit.
Xiaomi has also set up one more manufacturing facility in Sri City, taking the over facility count to six in the country.
Xiaomi’s India head and international Vice President Manu Jain told ET that these new facilities have helped the company double its manufacturing capacity to over two handsets per second.
The company didn’t share the investment figures for these new facilities.
The development comes after the India government imposed a 10% duty on imports of populated printed circuit boards (PCBs), camera modules and connectors, making the imports of the components expensive while giving a stimulus to local manufacturing under its Make in India program.
PCBs make up about 50% of the cost of making a phone. South Korea’s Samsung is among the only major brand that assembles PCBs in India. BCD on populated PCBs, camera modules and connectors, will push local assembly or manufacturing of these components, as companies who make here will get a price advantage over those who don’t.
Samsung has been doing PCB assembly in the country since 2006.
As per data from Counterpoint Research, local assembly of these components will increase the value addition, from present 10% to more than 15%.
The Chinese company is also inviting the world’s top fifty Chinese and Taiwanese components suppliers to invest in India, in line with the government’s phased manufacturing plan.
Jain said that these players could potentially invest $2.5 billion together in India over next few years and could create 50,000 jobs.