iPhone, iPad Are Apple of Govt’s Eye? Local Sourcing Norms to Be Relaxed For Opening Apple Stores

A special Govt. panel has decided to exempt Apple from strict norms pertaining to opening of retail stores. This special privilege for Apple means that they will no longer have to comply with the rule that 30% of all raw materials should be procured locally.

This special relaxation of rules was proposed, after Apple gave a detailed presentation to Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek last week; and explained the process behind Apple’s production, manufacturing, their patents on hardware and their technological innovations.

It seems DIPP has been convinced that Apple could not (and should not?) adhere to rules which Indian Govt. specifies for single brand retail in order to open their own retail stores inside the country.

A source from DIPP shared, “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,”

DIPP has already sent their recommendations to the Finance Ministry, and a decision would be soon taken in this regard.

At present, Apple sells their products via distributors such as Redington and Ingram Micro. They have already launched special EMI scheme for corporate users as well.

In January this year, Apple stated that they ‘wish’ to open retail stores in India, and had sought DIPP’s approval for the same.

Meanwhile, Govt. of India constituted a special committee to understand and comprehend whether every single brand retail needs to adhere to rules such as 30% local sourcing of raw materials. And Apple seems to be the first such company to get lucky because of this special provision.

Interestingly, ever since FDI in single brand retail was eased, other Chinese smartphone firms such as Xiaomi and LeEco are also attempting to open their own retail stores in India. Gionee has also submitted their request to DIPP; and Apple’s approval can actually set a precedence, as these companies can be allowed to open stores as well.

But, at the same time, another concern is bothering gadget lovers from India: Will Apple use India as another dumping ground of their historical handsets?

Although Apple is the biggest 4G handset seller in India, as they overtook Xiaomi this March, Apple also wanted to establish India as a base where they can sell refurbished handsets from China and basically use India as a dumping ground.

We will keep you updated as more details come in.