Foxconn will be doing this job in Sriperumbudur, Tamilnadu, where it already has a huge mobile manufacturing unit. It was not known whether the plans for Tamil Nadu included moving production out of China, where fears of the trade war with the United States have caused Taiwanese investors to look for alternatives, including returning to the island.
It is not known if any of the iPhone assembly is being moved from existing Hon Hai factories in China and elsewhere. According to another source, the expansion will allow Apple to manufacture the more expensive models like the iPhone X line in the country.
No doubt, Apple is seeing a decline in its overall sales volumes across the world. The iPhone SE and iPhone 6S were also assembled in the country by a plant operated by another major Taiwan-based manufacturer, Wistron Corporation, in the Bengaluru technology hub.
Hon Hai said it does not comment on matters related to current or potential customers, or any of their products.
Its sales in India have also been focused on lower-end phones - more than half of its sales volume is driven by models older than the iPhone 8, launched previous year, according to technology research firm Counterpoint.
The 32 per cent share of iPhone sales for the XR model compares favourably to the 30 per cent share for iPhone X in the similar timeframe last year, but lags the combined share of iPhone 8 and 8 Plus during that period last year, the report said.
Full details of Apple's deal with Foxconn are not yet clear and could change.
Apple's decision to start making iPhone outside of China may not surprise anyone given the current trade war going on between the U.S. and China.