Apple had requested the Indian government for some special benefits in August. There was a ray of hope last week after India gave a nod to Chinese phone manufacturer Oppo to start single-branded retail stores here. It was assumed that now the government would consider Apple’s proposals too. However, a report in ThePrint now claims that it may not be the case, and India wouldn’t mete out any concessions or tax breaks to the iPhone-maker to set up its manufacturing base here. Also Read - Apple Watch SE GPS for Rs 24,900 until tonight: How to quickly avail this dealAlso Read - iPhone 13 series leak roundup: From 25W charger to autofocus ultra-wide camera and more
In a communication dated October 9, the Department of Industrial Policy & Promotion (DIPP) has reportedly ruled out any further duty exemptions for Apple. It would not even extend permission to repair and re-export used mobile phones for up to seven years, as earlier requested by Apple. The DIPP has written to Apple India on its reference “seeking concessions/exemptions as pre-requisites to establish iPhone FG [finished goods] manufacturing in India” and has also put out a status report on the pre-requisites, the report states. ALSO READ: Apple Stores in India close to reality as government considers requests on tax breaks: Report Also Read - Face ID to reach Macs, all iPhones and iPads in a couple of years
While Apple started manufacturing iPhone SEs (the budget variant of the iPhone) out of its partner Foxconn’s factory in Bengaluru earlier this year, it doesn’t yet have permissions to set up its own base here. When Apple CEO Tim Cook toured India in May and met PM Narendra Modi, one of the key areas discussed was this: Apple was keen to expand its presence in India, where the Cupertino-based giant sells more iPhones than anywhere else in the world. However, the prohibitive costs of iPhones has ensured that Apple has remained a premium-plus player in the domestic smartphone market with its share well under 5 percent. ALSO READ: How iPhone 8, iPhone X will impact the premium end of India s smartphone market
If Apple manufactured locally, it could bring down the cost of production of each iPhone and possibly pass on the cost benefits to consumers. Now that the local government is in no mood to cater to Apple’s demands, the company might have to reconsider its India expansion strategies. “My view is that India needs to support Apple to create an ecosystem, which was done for Maruti Initial support will pay rich dividends in the long run and facilitate innovation, design and manufacturing of electronics components in India,” a government official had earlier said. Apple, however, declined comment on the issue.