Apple India stores a step closer
In this article (5)
A government panel has recommended the removal of a trading obstacle that would free Apple India to open single-brand retail stores across the country, one of its few growth markets.
A three-member panel has recommended the waiving of the mandatory 30 per cent local sourcing condition for Apple, which earlier this year asked the government to consider the exemption. The reason for the waiver is said to be the cutting-edge technology the company would bring to India, reports The Tech Portal.
With the committee’s finding, Apple is just a step away from a final decision. The Department of Industrial Policy and Promotion (DIPP) will send the proposal for final approval to the Finance Ministry.
Apple has retail stores across the world, including China and Japan. In India, it sells its products through exclusive reselling arrangements with chains such as Imagine and iStore.
In November last year, India scrapped the condition of 30 per cent local sourcing for overseas companies seeking to invest more than 51 per cent equity in the single-brand retail segment, if certain other conditions are met.
Chinese tech retailer Xiaomi has also applied to open single-brand stores in India while seeking the sourcing exemption for a range of products including Wi-Fi amplifiers, Bluetooth speakers and power banks.
Questions & Answers
Q.What was the main obstacle preventing Apple from opening its own stores in India?
What was the main obstacle preventing Apple from opening its own stores in India?
The primary barrier was a mandatory condition requiring single-brand retailers to source 30 per cent of their components locally. This rule has now been recommended for waiver by a government panel.
Q.Why has the government panel recommended waiving the local sourcing condition for Apple?
Why has the government panel recommended waiving the local sourcing condition for Apple?
The waiver has been recommended due to the cutting-edge technology that Apple is expected to bring to India. Apple had previously requested this exemption from the government.
Q.What is the next step before Apple can get final approval to open its stores?
What is the next step before Apple can get final approval to open its stores?
The Department of Industrial Policy and Promotion (DIPP) will send the panel's proposal to the Finance Ministry for its final approval. Apple is currently just one step away from this decision.
Q.Are other companies also seeking similar exemptions for single-brand retail stores in India?
Are other companies also seeking similar exemptions for single-brand retail stores in India?
Yes, Chinese tech retailer Xiaomi has also applied to open single-brand stores in India. They are similarly seeking an exemption from the local sourcing condition for several of their products.
Reader pulse
Is lifting the sourcing rule a good move?
23,440 votes so far