New Delhi: Prime Minister Narendra Modi and South Korean President Moon Jae-in have inaugurated Samsung Electronics Co. Ltd’s mobile phone factory in Noida—the largest in the world. The facility is spread over 35 acres in Noida’s Sector 81.

Very big step forward! @PMOIndia @narendramodi Mission @makeinindia takes big leap forward.@Samsung will start biggest manufacture,globally of @SamsungMobile in India.Many more to follow.We r commited,create jobs,increase manufacturing,get more investments,new opportunities — Suresh Prabhu (@sureshpprabhu) July 9, 2018

Said to be built at a cost of ₹ 4,500 crore, the Samsung’s Noida plant can produce 12 crore mobile phones every year, ranging from low-end smartphones to its flagship Samsung Galaxy S9, and will create 15,000 local jobs.

The factory will also help Samsung to compete with rivals such as China’s Xiaomi, which became India’s biggest smartphone brand by shipments earlier this year.

Under intense competition from Apple Inc. and Chinese rivals that also include Oppo, Vivo, Gionee and Lenovo, Samsung plans to make India its export hub for countries in Europe, Middle East and Africa.

Keeping with PM Modi's 'Make in India' policy, the first step was taken today, both the leaders (South Korean President&PM Modi) will visit Samsung's manufacturing site which will be producing 10 million units of mobile phones per month by 2020: South Korean Trade Minister #Delhi pic.twitter.com/7MKqknszme — ANI (@ANI) July 9, 2018

Samsung’s Noida plant was set up in 1996 where it has been manufacturing smartphones, refrigerators and flat-screen televisions. The South Korean electronics giant had last year announced a fresh investment of ₹ 4,915 crore to expand the existing plant by another 35 acres. It was meant double the production capacity of both mobile phones and refrigerators.

Uttar Pradesh chief minister Yogi Adityanath has already visited the Samsung plant in Noida ahead of inauguration by Modi and Moon at 5 pm.

“This ₹ 50 billion investment will not only strengthen Samsung’s business ties in India, it will also play a key role in India-Korea relations," Modi said in a speech at the inauguration of the plant.

Samsung said last year it would spend ₹ 49.2 billion ($716.57 million) over three years to expand capacity at its Noida plant.

“We ‘Make in India’, ‘Make for India’ and now, we will ‘Make for the World’," H.C. Hong, chief executive officer at Samsung India said in the statement.

“The opportunity is just massive," said Faisal Kawoosa, who heads new initiatives at researcher CMR Pvt. “Such a large facility will help Samsung cater to the huge demand in a country of 1.3 billion people where there are only 425 million smartphone users."

India’s smartphone market grew 14% with total shipments of 124 million units in 2017, the fastest pace of growth among the top 20 markets, according to International Data Corp. Demand for new phones is surging in India, helped in part by Reliance Jio’s cheap phones, free voice services and cheap data plans. Chinese smartphone maker Xiaomi Corp. said in April it will set up three more factories in India.

India attracted the highest ever foreign direct investment in the past year with inflows totalling $62 billion.

Last year, India overtook the US to become the world’s second-largest smartphone market after China. There will be 780 million connected smartphones in 2021, compared with 359 million in 2016, according to a study by Cisco Systems.

Moon, who arrived in New Delhi on Sunday on a four-day visit to India, is expected to meet Lee Jae-yong, the son and heir of Samsung’s current chairman Lee Kun-hee, for the first time since he took power in May last year.

Samsung’s reputation was dealt a blow by the bribery conviction of Lee Jae-yong, who was a key figure in the scandal that ousted former South Korean leader Park Geun-hye following massive nationwide protests, and was sentenced to five years in jail last year. But the sentence was reduced on appeal in February to a suspended jail term, and the 49-year-old scion was released after spending nearly a year in prison.

With inputs from agencies.

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