India on Thursday approved a manufacturing joint venture between China’s Vivo and local maker Dixon Technologies, a move that could mark the next phase of the country’s smartphone manufacturing boom after Apple helped turn India into a global smartphone manufacturing hub.
The approval allows Vivo to move forward with a long-delayed manufacturing partnership announced for the first time in December 2024 after New Delhi cleared the investment under investment rules introduced in 2020 that require additional state scrutiny of investments from countries that share a land border with India – a category that includes China. The joint venture will acquire some manufacturing assets from Vivo, manufacture part of the company’s smartphone orders in India and will also be able to produce electronics for other brands, according to stock exchange filing from Noida-based Dixon.
The 51/49 venture – majority owned by Dixon, with Vivo holding the remaining stake – reflects a wider shift in the way Chinese smartphone brands are expanding their production in India through local partnerships. For an industry watching how governments manage the relationship between Chinese capital and domestic production, the structure, analysts believe, could become a model for similar arrangements across the industry, helping expand India’s smartphone-making story beyond Apple.
In recent years, India has emerged as a major global smartphone manufacturing hub as Apple and its suppliers have expanded iPhone production in the country while diversifying supply chains beyond China. Government incentives have also helped attract global electronics manufacturers, boosting the country’s role in global smartphone production.
Apple has spent years building its manufacturing footprint in India and today accounts for 57% of the country’s smartphone exports by volume, according to Counterpoint Research data shared with TechCrunch. Chinese brands, on the other hand, dominate India’s smartphone market sales with 72% of the market but contribute less than 10% of exports, a gap that shows how much upside is still on the table if they start exporting from India like Apple is doing.
Apple’s manufacturing expansion in India is largely driven by suppliers such as Foxconn and Tata. Chinese smartphone brands, meanwhile, are are increasingly exploring partnerships with Indian companies after New Delhi stricter investment rules for neighboring countries following it Border clashes 2020 with China. Several of these companies, including Oppo, Vivo and Xiaomi, have also faced tax and regulatory investigations in India in recent years, which explains why giving majority control to an Indian partner now looks like the most viable path forward.
Local partnerships like the Dixon-Vivo venture offer Chinese brands a more stable operating model while aligning with India’s push for greater local involvement in electronics manufacturing, said Tarun Pathak, director of research at Counterpoint Research.
“The approval of this joint venture creates a win-win for both players,” Pathak told TechCrunch. He added that the majority-owned structure in India gives Vivo greater policy alignment while giving Dixon the scale to deepen local value addition and pursue exports.
Vivo has manufactures and exports smartphones from India for years, but the approved venture marks a shift to a majority Indian-owned manufacturing structure as the market leader deepens its footprint in the world’s second-largest smartphone market. The Chinese smartphone vendor retained first place in India’s smartphone market with a 23% shipment share in Q1, per Counterpoint.
For Dixon, India’s largest electronics manufacturing services company, the venture could add annual manufacturing volumes of about 20 million to 22 million smartphones, based on Vivo’s current sales, according to comments by the company’s CEO Atul Lall in May. earnings call. That’s a significant increase in volume for a public company whose growth has increasingly depended on winning just these kinds of manufacturing contracts.
Dixon is already building smartphones for Xiaomi, suggesting that the Vivo venture is building on an expanding role as a manufacturing partner for both global and Chinese smartphone brands in India and cementing its position as one of the most reliable bets in Indian electronics manufacturing.
When you purchase through links in our articles, we may earn a small commission. This does not affect our editorial independence.
