India approves Vivo and Dixon Technologies joint venture to boost local smartphone manufacturing

1. Joint Venture Approval

The Indian government has approved a manufacturing joint venture between the Chinese smartphone company Vivo and the Indian manufacturer Dixon Technologies. This partnership, originally announced in December 2024, was subject to regulatory scrutiny under 2020 investment rules that require additional government oversight for investments from countries sharing a land border with India. The new entity will be 51% owned by Dixon and 49% by Vivo, allowing the venture to acquire specific manufacturing assets and produce smartphones for Vivo as well as other electronic products for additional brands.

2. Strategic Industry Shift

This partnership represents a significant shift in how Chinese smartphone brands operate within India. Following increased regulatory and tax scrutiny in recent years, many Chinese firms are moving toward majority-Indian-owned structures to ensure more stable operations. Analysts suggest this model could serve as a template for other foreign companies seeking to align with India’s push for greater local participation in electronics manufacturing. For Dixon Technologies, the venture is expected to increase its annual manufacturing capacity by approximately 20 million to 22 million smartphones.

3. Context of India’s Manufacturing Growth

India has rapidly become a global hub for smartphone production, largely driven by Apple and its suppliers, such as Foxconn and Tata, which have significantly expanded iPhone manufacturing in the country. While Apple currently accounts for 57% of India’s smartphone exports by volume, Chinese brands dominate the domestic market with a 72% share but contribute less than 10% of total exports. The new joint venture is seen as a step toward bridging this gap, as it encourages Chinese vendors to deepen their local manufacturing footprint and increase export capabilities from India.