Apple Sets Its Own Terms To Set Up Shop In India 

Cupertino-based Apple Inc. told the Indian government on Wednesday that it was ready to manufacture iPhones in the country, but on the condition that it gets waivers including a customs duty concession on import of components, people privy to the discussions told BloombergQuint on the condition of anonymity.

Senior executives from Apple, including Global Vice-President Priya Balasubramaniam, met officials from the ministries of commerce, information technology, and finance, where they presented a detailed roadmap on the company’s plan to set up a manufacturing unit in India. The government is yet to take any decision on the matter, said the same people quoted above, adding that the company's proposal would be examined by concerned government departments, including the department of revenue, which is the nodal body for any duty waivers.

Apple has shown its intent to move some units out of China citing the rising cost of production in that country, and has narrowed down on India as its destination of choice thus far.

India is also the fastest growing market for Apple, and given the relatively low cost of labour and production, it fits the bill for the company to set up operations in the country.

Apple intends to set up one manufacturing unit in India, as per its current plans, and has sought duty waivers for its component suppliers as well, all or most of whom are also likely to set up base in the country, said the same people quoted above. Apart from the exemption from customs duty on import of components for a period of 15 years, the company has also sought a relaxation in the norm where companies have to locally source at least 30 percent of its components.

The company has sought the duty waivers for its suppliers, citing the inverted duty structure as a reason for the request. Presently, the software giant has six manufacturing units in China and one in Brazil.

Assuming the company does set up manufacturing in the country, it would, by definition, also get permission to set up single-brand retail stores in the country, which has also been on Apple’s wishlist for long.

Executives from the company had called on Commerce and Industry Minister Nirmala Sitharaman on Tuesday to present their proposal to her. The meeting lasted around 40 minutes, the details of which are awaited.