Roger Fingas
Apple may not have secured permission to open its first stores in India after all, though the company has not been shut out of the process, a report said on Tuesday.
India's Foreign Investment Promotion Board has ruled that Apple must follow rules requiring it to procure at least 30 percent of parts locally if it wants to sell through a single-brand store, sources informed Bloomberg. Apple was seemingly set to be granted an exemption, but the FIPB decided that it will not be approved.
The company's remaining chance lies in the fact that the FIPB's ruling must still be ratified by Finance Minister Arun Jaitley, the sources said.
On Saturday Apple CEO Tim Cook concluded a tour of India by speaking with Prime Minister Narendra Modi. Retail stores were one topic of discussion, and Cook may have tried to sway Modi and his administration into granting permission. Reports have suggested that Apple is already hunting for real estate, and planning to launch three stores within the next 18 months.
Apple's main assembly partner, Foxconn, is looking into building an Indian manufacturing plant. Until then, Apple will have no manufacturing footprint in India, leaving it unable to meet local sourcing requirements.
Charles Martin
Christine McKee
Wesley Hilliard
Malcolm Owen
Andrew Orr
William Gallagher
Sponsored Content
10 Comments
You have to "pay to play" as the saying goes. Apple will pay and it will happen. This is just the negotiation phase.
This report is probably factually true so far, but just going through the chain of command:
step 1: Apple applies for retail store
step 2: FIPB checks if the manufacture 30% in India. Finds they do not. Stamp DENIED on the paperwork.
step 3: now it goes on to the next step.
Read this: "Indian government approves apples bid..."
http://iphone.appleinsider.com/articles/16/04/28/indian-government-approves-apple-bid-to-open-stores-free-of-30-sourcing-policy
According to sources, a committee headed by Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek will recommend exempting Apple from a government mandate that requires foreign companies operating single-brand stores to source at least 30 percent of goods sold from domestic suppliers, The Times of India reported on Thursday.
"The committee has found that the company's products are cutting edge technology and state-of-the-art. It has recommended to exempt them from the local sourcing norms," sources said.
Read this: "First three Apple stores to open in India by end of 2017"
http://iphone.appleinsider.com/articles/16/05/16/first-three-indian-apple-stores-rumored-to-launch-by-end-of-2017
India wants Apple to become an Indian company. They are out of their minds.
They try to bad mouth China to make India appear as a better opportunity for Apple. In their wet dreams!
I say screw them. No Apple store for them. Leave them in their 3rd World status.
https://youtu.be/INFcn63gVBA
Rules mandating local content are just misguided. They believe they are creating jobs but only serve to raise the cost of products and limit the consumer's choice in those countries. This happens in many third-world countries, particularly in South America. Manufacturing growth in India needs to come organically. For example, Apple enters the market and begins selling phones made in China. If they're successful, at some point, it becomes more economical to produce the phones locally. That way the infrastructure also builds around that manufacturing base to support its growth. Perfect example of this in action is the fact that virtually every Toyota or Honda and many BMW, Mercedes and VW vehicles sold in North America (US/Canada/Mexico) are now built in the North America.
It's ok. It's not like they really need to have an Apple Store for the 5 people in India who can afford a ridiculously expensive iPhone.