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Possible Compromise Could Allow Apple to Open Retail Stores in India

Possible Compromise Could Allow Apple to Open Retail Stores in India

The on-again, off-again possibility of the Indian government giving the OK for Apple to open retail stores in the country could possibly be on-again. The Times of India reports the government is prepared to allow Apple to open three planned retail outlets without any 30% Indian sourcing requirement for the first few years of business.

Possible Compromise Could Allow Apple to Open Retail Stores in India
An Apple premium Reseller in India

Foreign companies are usually required to source at least 30% of their goods from companies located in India. Apple does not have any factories in India. Most of the company’s products are made in China. The company currently sells its products in India via third-party retailers.

Last year, it appeared Apple might be allowed to open its stores in India, as the local government had ruled to exempt any retailers selling “state-of-the-art goods from the rule. At that time, Apple filed a new application to open three stores.

Earlier this year, it was reported that a committee, led by Department of Industrial Policy and Promotion (DIPP) secretary Ramesh Abhishek, was prepared to recommend exempting Apple from the law requiring single-brand foreign owned stores to source at least 30% of their goods from domestic suppliers. However, that recommendation was shot down by the ministry of finance, saying Apple’s products do not fit into the “cutting-edge” category.

Now the winds of change once more appear to be blowing in the other direction, as the DIPP and the finance ministry appear to be more accepting of the idea of Apple opening retail stores in the country without immediately complying with the 30% rule. This would give Apple a chance to put things into motion to examine opening a manufacturing plant in India. (Assembly partner Foxconn is said to be planning to build a factory in India, which could help Apple meet the requirements.)

“It is only fair to insist on some local production and two-three years is a reasonable period. Five years may be too long,” The Times was told by source, who did not wish to be identified.

Apple has informed the Indian government that it is currently buying chargers from India, not just for sale within the country but also for export to other markets.

All of this is still not set in stone, so until we see an official announcement form the Indian government and Apple, we’re not holding our breath on this one. (Even though we’ve been told we look smashing in blue!)

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