The government has approved a proposed joint venture between domestic electronics manufacturer Dixon Technologies (India) Ltd and Vivo Mobile India Pvt Ltd, a subsidiary of Chinese smartphone maker Vivo.
Dixon informed stock exchanges about the approval in a regulatory filing on Thursday, stating that the government granted clearance for the partnership on July 8.
The two companies had signed an agreement on December 15, 2024, to establish a joint venture for manufacturing electronic products, including smartphones.
The approval is significant as it is among the first major clearances under the revised Press Note 3 framework, which relaxed foreign direct investment (FDI) rules for companies linked to countries sharing a land border with India.
Earlier this year, the Department for Promotion of Industry and Internal Trade (DPIIT) revised the investment norms, allowing investors from neighbouring countries such as China to acquire up to 10% non-controlling beneficial ownership in Indian companies through the automatic route, subject to applicable sectoral limits.
However, government approval continues to be mandatory in cases where an Indian company with existing foreign investment undergoes a transfer of ownership and the new beneficial owner belongs to a land-bordering country.
Under the Dixon-Vivo joint venture structure, Dixon Technologies will hold a 51% stake, while Vivo Mobile India will own the remaining 49%. Neither company will acquire any ownership stake in the other entity.
The newly formed venture will manufacture smartphones for Vivo, but it will also have the flexibility to produce electronic devices for other brands, Dixon said.
The partnership is expected to strengthen Dixon’s position in India’s growing smartphone manufacturing ecosystem and expand its capabilities in electronics production.
“This association will bolster the company's manufacturing excellence and superior execution abilities. This partnership will further strengthen the company's foothold in the Android smartphone ecosystem in India in line with Dixon's strategic goals,” the company said.
The collaboration comes as India continues to promote domestic electronics manufacturing through initiatives aimed at building local supply chains and reducing dependence on imports.
The smartphone manufacturing sector has emerged as a key focus area under India’s broader electronics manufacturing strategy, with global companies increasingly looking to expand production capacity in the country.
The Dixon-Vivo partnership is expected to contribute to India’s manufacturing ambitions while enabling Vivo to strengthen its production operations in one of the world’s largest smartphone markets.
