Taiwan approves Hon Hai's US$2.2 billion investment plans in India, U.S.

Taipei, June 24 (CNA) Taiwan-based manufacturing giant Hon Hai Precision Industry Co. has secured regulatory approval for two investment plans in India and the United States worth more than US$2.2 billion, the Department of Investment Review under the Ministry of Economic Affairs said on Tuesday.

The department said it has approved a plan by the iPhone assembler Hon Hai, also known as Foxconn globally, to spend about US$1.49 billion to raise investments in its subsidiary in Singapore -- Foxconn Singapore Pte. Ltd.

The Singapore subsidiary will use the funds to invest in another Hon Hai unit called Yuzhan Technology (India) Private Ltd. in India, to build a new facility to roll out smartphone components, the department said.

Amid trade fractions between the United States and China, Hon Hai is believed to be diversifying its production out of China with India seen as an ideal destination to make iPhones and iPhone components, and the new investment in Yuzhan Technology (India) is part of its efforts, market analysts said.

In addition, Hon Hai has also obtained the greenlight from the MOEA to allocate US$735 million from its disposal capital to set up a new company in the U.S. -- Project ETA (DE) LLC -- which will be in charge of data center module production as well as server assembly businesses.

As Hon Hai expands globally, it has been extending its reach in production to countries and regions such as the U.S., India, Mexico, Vietnam, and Europe.

Through regionalized manufacturing, Hon Hai has 223 plants and offices in 24 countries around the world with 54 footholds in the Americas, 12 in Europe and 12 in India.

Meanwhile, the MOEA said Cathay United Bank, a banking arm of Cathay Financial Holding Co., has obtained approval to invest US$160 million in its branch in Ho Chi Minh City for the Vietnamese outlet's lending business.

In addition, the MOEA said AUO Mobility Solution Corp., a wholly owned subsidiary of flat panel maker AUO Corp., has been approved to remit US$20 million to invest in its subsidiary in Xiamen, which produces automotive display components, other auto parts and accessories.

As for inbound investments, the MOEA said Hong Kong-based Royal Seal Holding Co. has secured the greenlight to invest about NT$97.07 million (US$3.29 million) in its branch in Taiwan for the Taiwanese outlet's tumor radiological treatment business. Cowealth Medical Holding Co., which is listed on the local over-the-counter market, is a major shareholder of Royal Seal.