The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
Last fiscal year, Apple Inc. tripled its iPhone production in India, the world's fastest-growing smartphone market, assembling over $7 billion worth of iPhones and reducing its dependence on China. Now, nearly 7% of Apple's iPhones are produced in India through partnerships with companies such as Foxconn Technology Group and Pegatron Corp., according to sources. This marks a significant increase for India, which was responsible for an estimated 1% of global iPhone production in 2021.
As tensions between Washington and Beijing persist, Apple is seeking to minimize its reliance on China. The company's long-standing partners, responsible for manufacturing the majority of iPhones in China, have rapidly expanded assembly lines over the past year. In 2022, Apple faced challenges at Foxconn's main "iPhone City" complex in Zhengzhou, which exposed supply chain vulnerabilities and led to reduced output estimates. Meanwhile, Indian Prime Minister Narendra Modi has implemented various incentives to promote local manufacturing.
Apple exported $5 billion worth of iPhones in the year ending March 2023, nearly quadrupling the previous year's figure. The tech giant plans to simultaneously manufacture the next iPhones in India and China by fall 2023, marking the first time assembly begins concurrently in both countries. With continued supplier expansion, Apple could assemble 25% of all its iPhones in India by 2025. Company representatives declined to comment.
Before the "iPhone City" incident, Apple had already recognized the need to diversify its supply chain. The company successfully lobbied for incentives in India, encouraging suppliers like Foxconn, Wistron Corp., and Pegatron to increase local production. These suppliers, employing around 60,000 workers in India, manufacture iPhone models ranging from the iPhone 11 to the latest iPhone 14.
This shift in iPhone production signifies an economic victory for India, potentially influencing the plans of other US brands. For Apple, India represents a significant growth opportunity, especially as the Chinese economy faces challenges following strict Covid Zero restrictions.
Apple is set to open its first two retail stores in India, located in Mumbai and New Delhi, next week. CEO Tim Cook is expected to attend the inaugurations, highlighting the growing significance of the Indian market. The Cupertino, California-based company has also requested changes to India's labor laws to facilitate local production expansion and the development of mega factories.
Foxconn, Apple's largest contract manufacturer, plans to invest approximately $700 million in a southern state facility for producing phone components and potentially iPhones.
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