Apple has accelerated the pace of winding up its business in China

The Apple company has accelerated the work of consolidating its business in China. It has accelerated the process of awarding its contracts to companies outside China.

For this, Apple is eyeing countries where it is cheaper to set up a factory and where geopolitical risks are less. In this context, its eyes are fixed on Vietnam and India.

Electronics company Quanta Computer is the main manufacturer of Apple's MacBook. It signed an agreement this month to set up its first plant in Vietnam.

This plant will be installed at a place named Dinh. Quanta director CT Huang has said- We are determined to make this factory operational as soon as possible. 

According to analysts, the plan to move production out of China is years old. One of the reasons for this is that labor is no longer as cheap as it used to be in China.

This has increased the cost of Apple's products there. Meanwhile, the technology related dispute between America and China has increased. It started in 2018, when the US President Donald Trump started a trade war against China.

According to a report on the website NikkeiAsia.com, Foreign Direct Investment (FDI) in Vietnam has increased at a steady pace. Earlier companies especially from countries like Japan and South Korea were investing there.

In 2019, FDI worth $38 billion came there. This was 80 percent more than a decade ago. But this trend stopped at the time of the Corona epidemic.

According to experts, now Quanta's decision to open a plant in Vietnam is a concrete result of American companies' efforts to reduce dependence on China. According to Taiwanese agency TrendForce, it is expected that by 2025, Quanta will start manufacturing 30 per cent of its total production outside China.

In the first quarter of the year 2023, there has been a jump of up to 87 percent in the investment of Taiwanese companies in Vietnam.

Ryotaro Hagiwara, a researcher at the Japan External Trade Organization's Hanoi office, told Nikkai Asia that North Vietnam, in particular, has become a hotbed for Apple's products. iPhone assembling major Foxconn is investing heavily in Vietnam's northern province of Bac Giang. 

There has been a sharp increase in Apple's investment in India as well. Foxconn has set up an assembling plant for the iPhone-14S in Chennai.

Apart from this, it is also preparing to set up its plants in Karnataka and Telangana. TrendForce estimates that by 2028, 30 to 35 percent of iPhone production will start outside China.