On Prime Minister Narendra Modi’s call “Local ke liye Vocal“, Lava on Saturday, 16 May announced to shift its entire mobile R&D, design and manufacturing for the export market from China to India within next six months, announcing to invest overall nearly Rs 800 crore in the due course of time.
According to a report published in Business Standard, this move is thanks to the government’s new production linked incentive (PLI) scheme for mobile manufacturers in the country. Industry executives say that it gives manufacturers here a 6% cost advantage, something they didn’t have earlier. According to the company, the “cost disadvantage” Lava had as compared to China is eliminated by the PLI scheme.
Lava exports over 33 per cent of its phones to markets such as Mexico, Africa, Southeast Asia and West Asia.
Hari Om Rai, Chairman and Managing Director of Lava said, “We have been eagerly looking forward to an opportunity to shift our entire mobile R&D, design, and manufacturing from China to India,”
“With the production linked incentives, our manufacturing disabilities for the world market would largely be met hence we plan to make this shift,” he added.
The company had also benefited from the recent US-China trade war, gaining a sudden influx of business last year. Reports suggest that US telcos AT&T, T-Mobile, and Sprint had handed orders worth approximately Rs. 2,500 crore to companies like Lava and Micromax, thanks to rising tensions between the two countries.
According to various media reports, iPhone giant Apple is planning to move much of its manufacturing to India in the next five years.
Last week, Lava resumed production at its manufacturing facility in Noida with over 20 percent production capacity. Nearly 600 employees of its 3,000-strong workforce are now back at the factory after the company received approval from the Noida authorities.
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