Dixon's Joint Ventures with Chinese Companies Face Government Scrutiny Under Page Note 3 Rules

The government plans to examine Dixon's recent agreements with Chinese companies Chongqing Yuhai and Kunshan Q Technology. These agreements involve the manufacturing and sales of electronic components for devices like mobile phones and laptops. An official stated that the application will undergo due process under Page Note 3 rules.

Dixon has entered into a joint venture with Chongqing Yuhai Precision Manufacturing Co Ltd. This partnership aims to produce precision components for laptops, mobile phones, IoT, automotive, and other products. Dixon is expected to hold a 74% stake in this venture, while Chongqing will own the remaining shares.

Focus on Electronics Components

In another agreement, Dixon signed a binding term sheet with Kunshan Q Tech Microelectronics India Private Limited (Q Tech India) and its shareholders. This includes Q Technology Singapore Private Limited and Kunshan Q Technology International Limited. The deal involves acquiring a 51% shareholding in Q Tech India, which is part of the China-based Kunshan Q Technology.

This collaboration with Kunshan Q Technology will enable Dixon to manufacture, sell, and distribute camera and fingerprint modules. These components are intended for mobile handsets, IoT systems, and automotive applications.

Incentive-Based Scheme Participation

Dixon Technologies has also announced its involvement in the Electronics Components Manufacturing Scheme. This scheme offers incentives worth Rs 22,919 crore to boost local manufacturing capabilities in the electronics sector.

The agreements with Chinese firms are part of Dixon's strategy to expand its footprint in the electronics components market. By partnering with established players like Chongqing Yuhai and Kunshan Q Technology, Dixon aims to enhance its manufacturing capabilities and product offerings.

These developments come as the government continues to scrutinise foreign collaborations in sensitive sectors. The focus remains on ensuring compliance with regulatory frameworks while promoting domestic manufacturing initiatives.

With inputs from PTI