A new 'iPhone city' is taking shape

The arrival of Foxconn is rapidly turning a rural town in southern India into a real estate hotspot.

Specifically, Devanahalli - an area located on the outskirts of India's technology hub Bengaluru - will be home to Foxconn's Elephant project with a land area approximately the size of 220 football fields.

The $2.5 billion plant is expected to become Foxconn's second largest outside China and create 40,000 jobs.

Diversify supply chain

According to Rest of World , the factory is part of Foxconn's efforts to diversify its supply chain amid the escalating US-China trade war. With Project Elephant, Foxconn plans to double iPhone production in India to 30 million units.

Foxconn's plan to build the factory was approved by the Devanahalli government in 2023 and is the biggest project in the agricultural belt known for grapefruit, green grapes and silk, among other products.

The construction site of Foxconn's iPhone assembly plant in Devanahalli. Photo: Rest of World.

Property prices in the area have risen 35% since Foxconn entered the scene, according to data from property consultancy Anarock. But there is still resistance to the broader wave of industrialization in Devanahalli.

While many farmers have agreed, some continue to protest and demand higher compensation for their land.

“Foxconn’s entry was a huge event for Devanahalli and arguably a pivotal moment in the supply chain transformation. It was like seeding a new city with a huge number of jobs in Devanahalli almost overnight.

Of course, such a scale has a ripple effect. The project will drive demand for housing, attract ancillary industries and suppliers, and generally draw attention to the area,” Ashwanth Sajeevan, CEO of PropPulse.ai, a real estate data and advisory platform for Bengaluru, told Rest of World.

Foxconn has partnered with local real estate developers to arrange housing for its workforce from China and other countries.

In addition, planners anticipate a large influx of workers, not only from the Elephant project but also from the Cheetah project — a Foxconn factory making electric vehicle components that is being built nearby.

Real estate price boom

Advertising properties within a 10-kilometer radius of the Elephant project has been highly effective, with the number of listings doubling in the past three years. According to PropPulse, there are about 60 housing projects, including apartments, villas and land plots, under development within a 20-kilometer radius. Prices currently range from $40,000 to $700,000 .

On her way back from a temple visit with her family in December 2023, Neethu Ramagiri saw a billboard advertising luxury apartments in Devanahalli.

Real estate agents market new projects in Devanahalli with the main advertising message being “near Foxconn factory”. Photo: Rest of World.

The IT professional drove in to see the property, got an immediate discount, and closed the deal on a three-bedroom apartment. At the time, the complex was still far from the city center and there was no metro line nearby.

However, sales agents pointed to Foxconn's entry and nearby infrastructure projects as ensuring future demand.

A year later, Ramagiri’s tenants included three senior Foxconn employees from the Philippines, China and Taiwan. She said there were still at least 10 other landlords in the complex who had rented their apartments to Foxconn employees.

Ramagiri said he currently earns $420 a month in rent, which he insists is much higher than the average in the area.

Additionally, since Foxconn provides meals for its employees, the reduced wear and tear on the kitchen is an added benefit for the homeowner. After all, Ramagiri says the apartment has appreciated about 70 percent in value since she bought it.

In fact, nearly 20 years before Foxconn broke ground, the industrialization of Devanahalli had begun. The turning point came in 2008, when the Indian government launched an international airport, creating a wave of development in this rural area.

Land acquisition and the construction of IT, aerospace and science parks are also progressing rapidly here. These areas, combined with new and improved roads and still affordable land prices, have made Devanahalli a destination for large-scale investments, attracting giants like Foxconn.

Property prices in the area have increased by 35% since Foxconn visited. Photo: Rest of World.

Foxconn has been hiring for the Devanahalli plant through 2024 and 2025. Another iPhone supplier, Wistron — now part of the Tata Group — is building another facility there that is expected to create 3,000 jobs, while German software giant SAP is also setting up an office in the area.

Farmers in Devanahalli, however, remain balky about government promises of job creation linked to growth coming from the tech hub.

“These promises are nothing new to the villagers. It is a beautiful fairy tale that they bring every time. But what preparations have they made for the work?”, Ramesh Cheemachanahalli, a farmer leader from Devanahalli told Rest of World.

Source: https://znews.vn/mot-thanh-pho-iphone-moi-dang-hinh-thanh-post1547484.html