Govt monitors Foxconn production after Chinese workers’ exit sparks iPhone slowdown fears

The Indian government is monitoring production targets at Foxconn after hundreds of Chinese technology professionals returned home from the Taiwanese electronics manufacturer’s plants in India, raising concerns about potential disruptions to iPhone production, PTI reported on Friday, citing people familiar with the matter.

The departure of more than 300 Chinese workers in recent months has triggered speculation about delays in producing Apple’s upcoming iPhone 17 series.

A Bloomberg report earlier said that most Chinese staff at Foxconn’s southern India factories were asked to return home, leaving mainly Taiwanese support staff on site.

While it remains unclear why Apple’s largest iPhone assembler repatriated the workers, the report suggested Beijing had verbally urged regulatory agencies and local governments to limit technology transfers and equipment exports to India and Southeast Asia, in an apparent bid to slow manufacturing relocation.

The withdrawal is expected to hamper the training of India’s local workforce and transfer of manufacturing expertise.

“The government is monitoring the situation. Apple has alternatives and they should be able to handle this. The issue is primarily between Apple and Foxconn,” PTI quoted a government source as saying.

Most mobile phone manufacturing equipment is sourced from China, with Chinese professionals having deep expertise in operating it.

The engineers who returned were involved in assembly lines, factory design, and workforce training for iPhone production, according to the PTI report.

Foxconn, a key beneficiary of India’s production-linked incentive (PLI) scheme, is building a new iPhone plant in India as Apple scales up production outside China. The supply chain diversification began under US President Donald Trump’s first term and accelerated in the second term as companies sought to mitigate geopolitical risks and higher tariffs.

Apple plans to increase production to 60 million iPhones this year, up from around 35-40 million in 2024-25. CEO Tim Cook recently said all iPhones sold in the US during the June quarter would be shipped from India.

Foxconn’s Tamil Nadu factory and Tata Electronics, which operates Pegatron’s facilities in India, are the company’s main manufacturing partners in the country. Both firms are expanding capacity to meet rising demand.

India’s iPhone assembly surged by 60% in the year ended March 31, with exports worth about Rs 1.5 lakh crore ($18 billion). In March, exports to the US jumped 219%, according to S&P Global Market Intelligence.