China is making it harder for employees and specialised equipment needed for
high-tech manufacturing in India
and Southeast Asia to leave its borders, according to people familiar with the matter, a possible attempt to prevent companies from shifting production in anticipation of higher tariffs under US President-elect Donald Trump.
Officials in Beijing have verbally encouraged regulatory agencies and local govts to curb technology transfers and equipment exports to the regions, one of the people said, asking not to be identified because the discussions are private.
The aim is to shore up China’s own production, reduce any potential job cuts, and prevent foreign investors from fleeing the country if the US imposes new trade barriers, the person said.
Apple’s main assembly partner Foxconn hasn’t been able to dispatch its Chinese staff to India and its factory in the country hasn’t been able to receive additional specialised machinery from China, some of the people said. There’s been no immediate impact on production though, they said.
China’s ministry of foreign affairs said in a statement on Friday the nation “treats all countries equally and is open to enterprises” from everywhere. “China has never done anything that harms interests of other nations to the detriment of itself,” according to the statement. India’s ministry of electronics and information technology and Foxconn didn’t immediately respond to requests for comment.
India has been crucial to Apple’s strategy to lessen its reliance on China amid trade tensions between Washington and Beijing that could escalate further when Trump returns to the White House next week. Foxconn’s assembly plant in Chennai accounts for about half of the country’s iPhone exports, although the company still makes the bulk of Apple handsets in central China.
Beijing doesn’t want Foxconn to further diversify its productio
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