Electronics contract manufacturer Dixon Technologies and Chinese smartphone maker Vivo have announced a joint venture aimed at manufacturing smartphones for Vivo and other brands. According to an exchange filing by Dixon on Sunday, the Indian company will hold a majority stake of 51% in the joint venture, while Vivo India will own the remaining 49%. The partnership does not involve either company holding a stake in the other, ensuring both maintain independent operations outside the joint venture. 

While the financial specifics of the deal remain undisclosed, the agreement marks a significant step towards deeper collaboration between Indian and Chinese companies in the smartphone manufacturing sector. This development aligns with the Indian government’s push for Chinese firms operating in the country to form joint ventures with local entities. As part of broader regulatory measures, the government has encouraged Chinese smartphone brands to induct Indian equity partners, appoint Indian executives to key positions, and ensure compliance with Indian laws. 

The joint venture agreement is contingent upon finalizing the "optimum structure" and "definitive terms and conditions" outlined in the binding term sheet. Regulatory approvals will also play a critical role in the venture's formalization. The move comes against the backdrop of increased scrutiny of Chinese mobile phone brands in India, with allegations of tax evasion, non-compliance with local laws, and foreign exchange violations.  

This partnership represents an important milestone in strengthening India’s position in smartphone manufacturing and highlights the government's efforts to foster local participation in the operations of global brands. As Vivo and Dixon Technologies collaborate, the venture could pave the way for increased localization and enhanced Make in India initiatives in the electronics sector.