Samsung Electronics is planning to invest $296 million over the next three years so it can double its manufacturing power in India amid fears of sales slowing down in today's fast-growing smartphone industry.
Samsung India Electronics has signed a memorandum of agreement with the state government of Uttar Pradesh to expand a factory in Noida that is known to make televisions, refrigerators, mobile phones, split-type air conditioners and washing machines.
"In line with our commitment to 'Make in India' ... we are pleased to receive the Uttar Pradesh Government's approval to invest in the state and expand our manufacturing base here in India," said Samsung India President and CEO HC Hong.
Although Samsung Electronics did not go into further details on what products or product lines will be manufactured in Samsung India's Noida Plant, Hong stated that they will be stepping up innovation on their mobile phones, LED TVs and refrigerators.
He highlighted that since the digital age is expanding throughout the world, there is also a rise in the number of people resorting to the use of electronic gadgets, smartphones and appliances. He added that a much bigger and tougher manufacturing plant will greatly help the company address the growing needs and desires of its increasing customer base in India.
Sources said that Samsung India Electronics will be given 130,000 square meters of additional land for the expansion. Additionally, the expansion will bring about 2,200 more jobs to the citizens, which will help double Samsung's mobile phone development to 12 million units monthly.
"Today's MoU is yet another step in converting Noida into the electronics hub of India. I am happy Samsung is pioneering this transformation yet again," stated UP chief minister Akhilesh Yadav.
Another senior executive also praised the proposed deal believing that the expansion will bring about more exportation.
Under this MoU, bonafide Uttar Pradesh residents who are above 18 years old and have passed Class 10, the minimum educational qualification of matriculation, will be given free Samsung smartphones.
Samsung Electronics' decision to expand comes after the company suffered a purported $3 billion marginal profit loss when it withdrew its Galaxy Note 7 phones worldwide due to reports of explosions. The premium handset was the company's answer to Apple's iPhone 7 and 7 Plus released this year.
To make up for its terrible loss, Samsung decided to focus on marketing its other premium models including the Galaxy S7 and S7 edge.
