Wistron fined Rs 1.6 crore by SEIAA Karnataka for non-compliance with environmental clearance

The company had not sought environmental clearance for some of its investments in Bengaluru.

The Karnataka State Environment Impact Assessment Authority (SEIAA Karnataka) has slapped a fine of Rs 1.6 crore on Wistron, one of three Taiwanese iPhone manufacturers in India, for not complying with the environment clearance (EC) mandates for capacity expansion in 2021.

The company had doubled its smartphone assembly unit from 70,56,000 pcs per annum to 1,44,36,000 pcs per annum and manufacturing of printed circuits boards (PCBs) capacity from 72,28,800 pcs per annum to 1,44,36,000 pcs per annum. The company made significant investments of about Rs 438.6 crore for this in Bengaluru but didn’t apply for environmental clearance for the same.

The issue came into light during Tata Electronics' ongoing acquisition of Wistron's iPhone manufacturing unit in Karnataka's Kolar district. “During the diligence process, the company was found faulty,” a source close to the matter told DH that the company paid the fine in May 2023 and now all the clearances have come.

The company then sought retrospective environmental clearance from the SEIAA Karnataka under the “violation cases to obtain EC for the project with the Environmental Impact Assessment (EIA) report” early this year. However, it was too late.

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“This is a part of the clean-up operation (for Wistron’s exit from India),” a former senior employee who was associated with the company for about a decade and a half told DH. “Back then, guys like us kept repeatedly telling the company to take environmental clearance before starting the construction but nobody bothered. The company just went ahead and did construction because they were under pressure from Apple for more production and they needed more capacity immediately,” the source added.

The official representatives of Wistron declined to comment on the matter.

Wistron is now in the final stages of a takeover by the Tatas. Industry experts suggest that Tata Group sees Apple manufacturing as a lucrative opportunity. Given the central government's active efforts to push smart phone manufacturing in India through its Production-Linked Incentive Scheme coupled with Apple's growing interest in India, more collaborations on this front can be expected.

Most big players across the globe are focussed on China plus one strategy, which makes India their best choice to invest in manufacturing.