Apple plans for manufacturing in India gain momentum

Top company executives argued the case before government officials

Apple’s plans to manufacture in India made headway on Wednesday as executives of the company presented detailed plans to the country's federal government.

It may be some time though, before Apple gets permission for its proposal to manufacture in India as it reportedly involves a request for deep cuts in the import duties for components. The meeting on Wednesday is said to have ended inconclusively, according to sources close to the situation.

The Apple executives included Priya Balasubramaniam, a company vice president.

"We've been working hard to develop our operations in India and are proud to deliver the best products and services in the world to our customers here,” Apple said in a statement after the meeting. “We appreciate the constructive and open dialogue we’ve had with government about further expanding our local operations.”

India is now one of Apple’s fastest growing markets, with iPhone sales up over 50 percent in fiscal 2016 compared to the previous year. The high growth comes largely from a small user base of its products in the country, but with recent rollouts of 4G networks, the company expects more demand for its devices.

Samsung Electronics, followed by Chinese and Indian brands like Lenovo and Micromax, led the Indian smartphone market in the third quarter largely because they are able to deliver their products at various price points, according to IDC.

Apple has previously proposed to India that it would like to import refurbished phones to sell at a low cost to India’s price-sensitive consumers. That proposal was shot down by some sections of government because there were concerns that it could involve end-of-life products, leading to e-waste disposal issues.

Setting up manufacturing in India will also help Apple's bid to set up wholly owned retail stores in the country. Under Indian rules, foreign-owned, single-brand retailers have to source 30 percent of their products locally.

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John Ribeiro

IDG News Service
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