Samsung is re-locating the factory to the state from China, the Uttar Pradesh administration said in a statement, a move that will help boost Prime Minister Narendra Modi’s flagship drive to make India a manufacturing hub.
India is the world’s second-biggest smartphone market with significant growth potential, which has driven companies such as Samsung to expand locally.
New Delhi earlier this year also approved financial incentives–under a $6.65 billion federal plan to boost domestic smartphone production–for 16 companies, including Samsung and top Apple suppliers Foxconn, Wistron and Pegatron.
On Friday, Uttar Pradesh said Samsung will receive 7 billion rupees in financial benefits and will also get an exemption from a tax payable on the transfer of land for the factory.
Samsung had sought tax and other incentives from Uttar Pradesh for this smartphone display manufacturing plant, Reuters previously reported.
The unit, expected to create 510 direct jobs, is expected to be operational next year.
Samsung already operates one of the world’s biggest mobile phone manufacturing plants in Uttar Pradesh.