Daybreak - Why replicating China's iPhone city model in India is a short-term fix for a long-term problem

Episode Date: September 26, 2024

What put iPhone city on the map is that it produces more than half of the world’s iPhone’s every single year. The global demand for the Apple iPhone has only increased over the years. To keep up with that demand Foxconn hires up to 200,000 workers – a mix of migrants and college students – to make sure that the assembly lines keep running. Especially during the peak season which happens to begin right around now, from September to February. Iphone city is the perfect example of the China manufacturing playbook. It is what propelled China to emerge as the world’s manufacturing hub. It’s pretty simple – Foxconn and companies like it build these large facilities, pack millions of migrant laborers into dorms near their facilities, and get them to work long hours, in often tough conditions. But now things are changing. More and more global companies are adopting a China-plus-one strategy. And India is becoming a favoured alternative. And  as the focus shifts our way, manufacturers in India are pretty much replicating the same China labour model. But this model has an indigenous problem.Tune inDAYBREAK UNWIND RECOMMENDATIONS for "best opening lines in a book or a film."Nicholas: 100 Years of Solitude by Gabriel Garcia MarquezStory he refers to: The Most Memorable Annual Pig Parade of KharagpurRahel: The Book Thief by Markus Zusak  Prithu: The Hitchhiker's Guide to The Galaxy by Douglas AdamsAvinash: Pride and Prejudice by Jane Austen Ruhi: Harry Potter and the Philosopher's Stone by J.K RowlingBrady: Rounders (film, 1998)Sayan: The Fellowship of the Ring, J. R. R Tolkien Sameer: Gangs of Wasseypur (film, 2012)Sumit: Slaughterhouse-Five by Kurt VonnegutRohin: The Body by Stephen KingSnigdha: The Haunting of Hill House by Shirley JacksonDaybreak is now on WhatsApp at [phone]. For next Thursday's Unwind, send us your recommendations to us as texts or voice notes. The theme is "favourite murder mystery."

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production.

Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get an alert as soon as we release our first episode, please follow Intermission on Spotify and Apple Podcasts or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. Have you heard of iPhone City?

It is a 5.5 square kilometre manufacturing plant located in East China, and it is run by Honhai Precision Industry, which is better known as Foxcon. the largest contract manufacturer of electronics in the world. Of course, no points are guessing what is manufactured at this particular plant in Chengzhou. You see, what put iPhone city on the map is that it produces more than half of the world's iPhones in a single year. The global demand for the Apple iPhone has only increased over the years. So to keep up with that demand, Foxcon hires up to 200,000 workers,

a mix of migrants and college students to make sure that their assembly lines keep running, especially during the peak season, which happens to begin about right now, from September to February. iPhone City is the perfect example of the China Manufacturing Playbook. It is what propelled China to emerge as the world's manufacturing hub. It's quite simple. Foxcorn and companies like it build these large facilities, pack millions of migrant labourers into dorms near these facilities and get them to work long hours, often in very tough conditions.

But now things are changing. More and more global companies are adopting a China plus one strategy and India is becoming a favoured alternative. And as the focus shifts our way, manufacturers here are pretty much replicating the same China labour model. Take the Narasapura industrial area for instance. It is about half an hour away from the Kolar gold mines in the southern state of Karnataka. This bustling little locality is home to Tata Electronics, Apple's Indian manufacturing partner.

The whole setup looks like it was pulled straight out of the China manufacturing playbook, complete with huge dormitories to pack workers into. Stats released by the Electronic Sector Scale Council of India state that nearly 6 million workers will have to be hired by 2025 to 2020. to meet the needs of India's burgeoning tech manufacturing industry. And Karnataka and Tamil Nad account for about 30 to 40% of this demand. While Tamil Nad hosts about half of Apple's 14 supplies in India, Karnataka has taken up aerospace and defense projects, along with electronics and precision engineering investments.

So all the big wigs of manufacturing are pumping in huge amounts of money to fulfill their ambitious hiring plans. They all clearly want to make the most of this manufacturing boom. So more jobs in a country grappling with rising unemployment, right? It's a good thing. Well, that is what we would like to think, but there is more to it, because this model has an indigenous problem, which is regional political parties are not happy about the sudden influx of migrant laborers.

Welcome to Daybreak, a business podcast from the Ken. I'm your host, Nagda Sharma, and I don't chase the news cycle. Instead, every day of the week, my colleague Rahal Philopos and I will come to you with one business story that is worth understanding and worth your time. Today is Thursday, the 26th of September. Table migration is not new to India, but that does not make it any less controversial, especially now when big companies like Tata are planning to hire lakhs of migrant workers to work in their manufacturing plants. Take the case of Tamil Nad for instance. Here, a regional political leader named S. Ramados urged the government to prevent the Tata group from hiring talent from outside the state. His argument was that so many local youth are still jobless.

So why should they hire people from other states? You see, when it comes to joblessness levels in Tamil Nad, Ramados has a point. A recent study by the International Labour Organization, which is a UN agency, found that more than a quarter of the educated population in Tamil Nad and nearly one-fifth in Karnataka are currently unemployed. But again, the counter-argument to that is that Tata was a company that did try to employ local farmers for its coal-ar plant in 2023. But their lack of skills in production operations rendered the effort useless. The Ken reporter Shrishdi-Ajur spoke to Lohid Bhatya, the president of workforce management at Quest Corps, which is a staffing company. He explained that,

that while talent is available in southern states, generally they have alternative job opportunities as well. So in many cases, the local talent has to be supplemented by migratory talent to fuel the sudden surge of job opportunities that occur. There is also the fact that companies tend to hire from a particular age group, especially those below 25 years. Sarkit Gorav, chairman and managing director of Technodome, a UAE-based consumer electronics distributor explained that that is because they generally do not have a problem with relocating.

Apart from age, gender is also coming up to play here. A lot of these companies have been pushing to hire more women. And that is because women's dexterity is favoured in assembly line operations. Currently, one-fourth of the entire tech manufacturing workforce in India is made up of women. and this is according to data from team lease. And three out of every four of them are employed in the electronics manufacturing industry. The idea is to get the right people from wherever as long as they have the right skills. Shrishi spoke to R. Murili Dharan, the chief technology officer at Aerospace Tech Manufacture Tata Advanced Systems.

And he said it is almost like the military. He said, and I'm quoting, they are very disciplined and there is no loss of production. and since you have enough workers, you can give two months off in a year. End quote. There is also another advantage for manufacturers in this kind of a system. And that is the non-existence of a labourer's network or any kind of a union. More on that in the next segment. It's been about a year since data electronics bought the manufacturing facility near Kolar

for $125 million from Taiwan-based Wistron Corp. Wistron was the original design manufacturer for Apple. Wistron was actually using the coal out plant for six years to produce iPhones. And then its employees launched a protest demanding a pay hike. Earlier to, in 2020, some of its employees ransacked offices owing to non-payment of dues and long working hours. Chidambram G. Ayer, who is an associate professor at the Center for Development Studies in Theruvanantapuram, explained why uprisings like these sometimes happen. He said that it is often difficult to get local labourers to work overtime.

And that is largely because they have a strong network. Meanwhile, when companies get migrant labourers from other states and make them stay in their own dormitories, their local network is a lot shallower. So it is easier for these companies to get them or push them to be more productive. Also, no network helps cut the attrition. problem in the bud. It also means you don't have to increase your wage costs constantly because training also requires a certain amount of investment. The biggest problem with the job market lies

in its inability to provide long-term secure employment. The automation of processes has a role to play here. A report by the World Economic Forum says that over two and five tasks will be automated globally by 2027. And turns out, the likes of Apple are also reportedly trying to cut their head count by half in the next five years and automate their assembly line operations. For companies like Tata, this will play out in interesting ways. For starters, it will mean that off the 250,000 jobs that it is planning to create by 2025, only about one-fifth will be expected to be on the payroll.

And the rest will likely be filled by contract. fractal workers who will be subject to the whims of the company's production needs. Basically, these ambitious hiring models that companies like Tata are committing to now may not make sense in the long term. The industry needs a long-term circuit fix for automation, unemployment and skill shortages. And taking a page out of the China playbook is not going to cut it. Hold on because this episode is not over yet. We still have daybreak unwinded.

Coming up next. Hello and welcome to the fourth edition of Daybreak Unwind. It's Thursday and Snigda and I are here to help you and more importantly also help each other. Figure out what to do this weekend. Yes, exactly. I mean, ever since we started this segment, we've had such great recommendations. I agree. Weekends have significantly gotten better.

I fully agree with that. Yeah, whether it's chilling at home, you know, reading a book, watching something nice, a great film or a great series. or even if you want to check out a cool place in town, you know, a great library, a bookstore, a great restaurant, anything, it could be anything. So last week we actually spoke about the theme of last week's segment was our favorite comfort food spots and we got some great recommendations. Okay, Sikda, I feel like you need to give all the listeners an update because I know that you actually went home and cooked your comfort food. I did.

For our listeners who didn't listen to last week's episodes, Stikda said that her favorite comfort food was alu-mimi. Yes. Sigda? Yeah, al-O-Mimi is this really spicy potato curry. It's like a very famous street food and daujiling. And you get it at all these small little tuck shops. And my favorite was Burry's Al-Odhamb shop, which was right above my school.

So I tried to recreate it. Of course, I failed. Oh no. But at least, a taste of home. Anyway, this week, our theme is the best opening lines from books or books or movies and brace yourself because we have a lot of recommendations. Yeah, by the end of this episode, you're definitely going to be spoiled for choice. Yes, absolutely.

Rahil, like, let's discuss a little bit about, you know, why this theme and why do you think opening lines of a book or a movie are so important. Yeah, I mean, I think it's because it's literally your first impression of the story, right? Yeah. Like, whether it's a book or a film, you know, if it's a great opening line, if it really catches your attention, it just pulls you immediately right in. Right?

Yeah. What do you think? Yeah, absolutely agree with you. And also, like, I often find myself, you know, if a very few books, you know, kind of have that effect on you. Like, you know, when you finish it, you're so moved. Yeah. In whatever way, it could be any genre of book, right?

And then when I finish it, I almost feel this sense of loss. You know, why is it over? Yeah. And then I. then I find myself going back to the first page and read, oh, yeah, I read the opening lines again. That's really amazing. I have book amnesia, so I'll read a book and immediately forget what it's about.

I don't know why that happens. But, yeah, there are some great opening lines out there, as we've learned while kind of doing this episode. Actually, Snigda, you know this. We asked this exact question to a writer. We wanted to know why opening lines matter so much, but from a writer. perspective. Correct.

Okay? His name is Nicholas Rixon. He writes fiction, mainly short stories, and currently he's writing his first novella. Here's what he had to say. I mean, I think the opening line of the novel is extremely important because it sets a tone, it establishes expectations. I mean, it captures the reader's attention, right?

So the opening sentence is a hook that draws the reader into a dynamic engagement with the narrative itself. But more often than not, think we realize the beauty and the brilliance of an opening line long after we finished reading the story or a novel, right? It's only then that a discerning reader realizes that the opening sentence is a concise version of the story's themes. I mean, but that being said, I think the first sentence must also stand on its own. Like, often there's an element of intrigue or an element of surprise to grip the reader's interest while also hinting at a larger narrative. And if I had to sum it up, I think a novel's first sentence is like a door.

It invites you into a house, but you don't know what the rooms look like. You don't know who's staying there. And you don't know what's going on inside until you step further away from the door into the house. So yeah. Also, Nicholas, you know, I'm curious to know how much time do you actually spend, you know,

writing the opening line of your story versus, you know, the whole story itself? I mean, every writer will have their own approach. and I don't mean to sound pompous or anything. But I feel like I've written more opening lines than I've actually finished stories. Like, I'll have a snippet of prose that I'll think, all right, this could work as an opening line. But then the real challenge is to maintain that same energy of that opening sentence

throughout the story. You know what I mean? Like, for example, a story of mine was in this anthology of upcoming writers in India. It was published by Aleph, a year or two ago. And the story was called the annual pick parade of Kharakpur. So I wrote the opening line for that story maybe five or six years ago, probably seven years ago, but I just couldn't find the right way to move beyond it until much later when it all came together. So writing isn't an exact science and an opening sentence is a means to an end, you know?

So for me personally, sure, I might have a decent opening line, but where do I go from there? I think that is the more pertinent challenge to any writer. Okay, now we want to hear your favorite opening line of all time. Yes, please. Oh, wow. I mean, there are so many great opening lines to choose from, but one of my all-time favorites is from 100 years of solitude by Gabriel Garcia-Marquez, where he opens with many years later, as he faced the firing squad, Colonel Oriliano Buendia was to remember that distant afternoon when his father took him to discover ice. I mean, what works for this opening line is that it introduces the reader to a crucial narrative event, but more than that, it's blending the past and the future in a single sentence. and it's establishing themes of memory, history and faith, right? Lovely. Thank you so much, Nicholas, for joining us.

All right, Rahil. Now it's your turn. Okay, Sikda, this was really hard for me because, again, book amnesia. But I really thought about it. And the first kind of opening line that really stuck me was from the book thief by Marcus Zusak. The whole book is narrated by death. Yeah. Okay?

So the opening lines are kind of fitting. So it goes, first the colors, then the humans, that's usually how I see things, or at least how I try. Here is a small fact, you are going to die. And the whole book is full of dry humor and it kind of reads a lot like poetry. Case in point. Yes. Yeah, again, it's narrated by death and it's set in Nazi Germany during World War II. I don't want to give too much away.

I'm sure everyone's read it by now, but great book to revisit. Yeah, and also there's a movie, right? There's a movie as well. Okay, so our next recommendation is from Prithu, and he has sent us a voice note, and it's from a very famous book. Must read, if you haven't already. It's from The Hitchhiker's Guide to the Galaxy by Douglas Adams.

This is Prithu from Bangal, and this is my most favorite opening line from a book. Far out in the uncharted backwaters of the unfashionable end of the Western spiral arm of the galaxy, lies a small, unregarded yellow sun. Orbiting this at a distance of roughly 98 million miles is an utterly insignificant little blue-green planet whose ape-descendant life forms are so amazingly primitive

that they still think digital watches are a pretty neat idea. Why I like this is because it just simply puts things into perspective. Thanks, Prithu, that was so lovely. You have a podcast voice, by the way. Next up we have another listener who sent us a voice note. His name is Avinash and his favourite opening lines are from Pride and Prejudice. Hi, this is Avonash. My suggestion for this week's unmind segment is the opening line from Jane Austen's Pride and Prejudice.

It is a truth universally acknowledged that a single man in possession of a good fortune must be in want of her wife. Apart from being elegant and iconic per se, the line also lends itself to so many adaptations or wordplay. Variants of it can be used in almost any context to put forth a point in an eloquent or even a funny manner. I see people on Twitter or even writers employ this to great effect. Right. And our next recommendation is from Brady. You have actually heard, if you listen to Daybreak regularly, you have heard Brady on Daybreak. He's the editor of the Ken Southeast Asia. And his recommendation is from a movie called Rounders.

It's this 1998 neo-noir, first. by this director called John Dahl and it has Matt Damon and Edward Norton. I love Edward Norton. Such a great actor. So this movie is about the underground world of high-stakes poker gambling and it's about

this reformed gambler who gets back into gambling. Won't give away too much. But these are the lines. Listen, here's the thing. If you can't spot the sucker in your first half hour at the table, then you are the sucker. Such a great hope.

Brilliant. Thank you so much, Brady. And next we have Shayan. Hey, I'm Shian. And I think the best opening line in a book goes to the Fellowship of the Rings, the first book in the trilogy of the Lord of the Rings. It goes something like this. When Mr. Bilbo Baggins of Baggins of Baggins announced that he would shortly be celebrating his 11th birthday with a party of special magnificence, there was much talk and exciting. and Hobbiton. I mean, what's the not like? It's 11th birthday. It's a party of special magnificence and people are excited. But in all honesty, I think it's the association of my childhood and just the depth of the Cholking world. And knowing that, you know, I'm set in for a long time, in a long adventure, it just makes it special.

So, yeah, that for me is the best opening name in the book. Thanks for having me, Snigda. Wow, thanks, Shayan. That was a great recommendation. Yes. Next up, we have Samir. And Samir's recommendation is from Gangs of Asikort. Wow.

One of my favorite, favorite of all times. So the opening lines go like this. I'm very excited to hear. Rahel, read out these lines. Okay, I'm going to do it dramatically. Insan, joe, they are just two nassalkeh. One are haramie, and the other, Bef goof

And this Sara Khael these both of these. Wow! Thank you

thank you thank you thank you you guys you got it right and next up we have

our in-house recommendation from Ruhi who writes a newsletter for us called inciting incident

and also heads our narrative workshops and she recommends the opening lines of

Harry Potter and the Philosopher's Stone and they are Mr and Mrs. Dursley of number

4 Privit Drive were proud to say that they were perfectly normal. Thank you very much. Love that. All right, moving on to our next recommendation, which is from Summitt,

who's our in-house desk editor. And Summitt recommends these lines from, opening lines from Kurt Warnigate's book called Slotterhouse, iconic book, Slaughterhouse 5. And it's basically, you know, centered around the infamous bombing of Dresden during World War II.

And it's semi-autobiographical, right? Right? Yeah, because he himself is a prisoner award. Yeah. So it's just one line and it goes, all this happened more or less. And Sumit says it's a great hook because it instantly throws the reader into this world

where nothing is quite certain. And, you know, it also hints at the non-linear structure and the non-reliable sort of narration that sets the stage for what he calls the novel's jumbled timeline. Nice. Next up we have Rohin. Rohan is the CEO here at the Ken. He also hosts another podcast called Two by Two.

Check it out if you haven't already. His recommendation is based on a book by Stephen King. It's called Different Seasons, The Body. And there's also a movie based on it called Stand By Me. It's about a group of boys who go to look for a dead body. He said that he loves the book and the movie. And the line that he really enjoyed was, I was 12 going on 13 the first time.

I saw a dead human being. There's a lot of death happening in this segment of deep day-break unwind. True, true. But yeah, Stigda, I want to hear your recommendation. Right, so I'm going to cheat a little bit because I don't have one line. It's the opening paragraph from this book called The Haunting of Hill House. It's a brilliant book. Also a Netflix show?

Yes. Terrible adaptation of the book. And the writer is this woman called Shirley Jackson. She's one of my favorite writers of all time. And remember, Rahel, I sent you this story called The Lottery. Yeah. Amazing story. Oh, incredible.

Yeah. I'm excited to hear these opening lines. Okay. So, the lines go. No live organism can continue for long to exist sanely under conditions of absolute reality. Even larks and kiti kids are supposed by some to dream. Hillhouse, not seen, stood by itself against the hills. holding darkness within.

It had stood so for 80 years and might stand for 80 more. Within walls continued upright, bricks met neatly, floors were firm, and doors were sensibly shut. Silence lay steadily against the wood and stone of hillhouse

and whatever walked there walked alone. Wow. It's a horror book, okay? It's a gothic horror book. That's amazing. And I want you to read all my audible books from here or now. Okay. This brings us to the end of our fourth ever daybreak Unwind, a success in my book.

Yes, absolutely agree. This is also that time in the episode where we announce the theme for next week. It is Murder Mysteries. And I was inspired by perfect couple, which I binge watched this weekend. So it can be absolutely anything. It can be a book, a film, a TV show, no rules. Okay, great. Thank you so much. And to send your recommendations, send us a WhatsApp.

message either as a text ideally as a voice note and here is a WhatsApp number you'll find it in the show notes as well it is 89711 08379 okay thank you in advance and that's a wrap