NEW DELHI (Reuters) - Amazon.com Inc (NASDAQ:AMZN) will start making its TV streaming device in India this year via a unit of Taiwanese contract manufacturer Foxconn, the U.S. online retail giant said on Tuesday.
The Fire TV Stick will be made by Foxconn subsidiary Cloud Network Technology in the southern city of Chennai, marking the first time one of Amazon's devices will be manufactured in India.
Amazon said hundreds of thousands of Fire TV Sticks would be produced annually, helping it to meet demand from Indian customers.
"Amazon will continuously evaluate scaling capacity to additional marketplaces/cities depending on the domestic demand," the company said in a blog post.
The launch of conglomerate Reliance's telecoms venture Jio in 2016 began an era of cheap data tariffs in India, aiding the growth of video and audio streaming services such as Netflix (NASDAQ:NFLX) and Amazon's Prime Video.
That in turn created a market for streaming devices such as the Fire stick.
Seattle-based Amazon's move to make the device in India coincides with Prime Minister Narendra Modi's push to make the country a hub for electronics manufacturing to compete with the likes of China and Taiwan.
New Delhi's local manufacturing drive has persuaded iPhone makers Foxconn and Wistron to expand in India. Pegatron, another big contract manufacturer, has also set up base in the country.
The push has also helped India to become the world's second-biggest mobile phone maker.
India's technology minister Ravi Shankar Prasad on Tuesday welcomed Amazon's move, adding that "Amazon should also work with small local shops and make them a stakeholder in the larger efforts of Amazon to grow its business".
Last week India's trade minister said the government was looking into foreign investment rules on e-commerce to ensure that the industry followed the spirit of the regulations and maintained a level playing field for all sellers on online platforms.