Taiwanese electronics major Foxconn said that it is committed to setting up a manufacturing facility in Kongara Kalan, near Hyderabad in Telangana.
The development has left many surprised as the electronic major chose Telangana over Karnataka for its plant.
Foxconn Technology Group chairman Young Liu in a letter addressed to the Telangana chief minister K Chandrasekhar Rao confirmed Foxconn’s commitment to setting up the manufacturing facility, a release from the chief minister’s office (CMO) said.
He further sought the support of the state in operationalising the Kongar Kalan Park at the earliest. “This clears the doubts that Foxconn was in a dilemma of whether it would set up the manufacturing facility in Telangana or not,” the release added.
“As discussed with you (Telangana CM) during our meeting on March 2, Foxconn is committed to setting up a manufacturing facility in Kongara Kalan and I seek the support of your team in operationlising the Kongara Kalan park as early as possible,” Liu said in the letter.
The decision of Foxconn to snub Karnataka is a major blow to the state, which had been courting the firm for months. Karnataka had offered Foxconn several incentives, including tax incentives and a land package, in an effort to persuade the company to set up its plant in the state. However, the offer was not enough to lure Foxconn away from its decision to move to Telangana.
It is speculated that Telangana’s lower labor costs and better infrastructure could have played a role in the company’s decision. In addition, Telangana’s strong presence in the IT sector could have been another factor in Foxconn’s decision.
Regardless of the reasons for Foxconn’s decision, the news has left Karnataka’s government disappointed. Karnataka had been hoping that the state would benefit from Foxconn’s presence.
However, earlier Foxconn said it will be in close contact with Karnataka to take its electronic manufacturing project on the outskirts of Bengaluru forward, pledging its commitment to work on the MoU it signed with the State Government on Friday.
Foxconn Chairman Young Liu wrote a two-page letter to Chief Minister Basavaraj Bommai stating that he will “ensure successful grounding of the “Project Elephant” in Bengaluru,” in an effort to dispel any ambiguity brought on by the business’s earlier claim that Friday’s agreement was not “definitive” in nature
