In order to start assembling iPhones in India, Apple had sent a long list of demands and wishes to the Indian Govt., which included tax holiday for 15 years and more.
We had initially assumed that Govt. will never listen to these demands and will out rightly reject them. However, things are not black and white anymore, because if we believe some reports, then it seems that Govt. can consider some of these demands.
And this means that there can be some good news for Apple finally.
Can Govt. Consider Apple’s Demands?
After Apple sent out the demands, IT Minister Ravi Shankar Prasad said, “We will very much like Apple to come and have a base in India”, adding that they considering the demands with an ‘open mind’ as negotiations are currently on.
If we analyze this statement, then it clearly means that Govt. is not in a mood to say no directly, and the demands of Apple can be considered after all.
However, officials from Department of Commerce and DIPP are, it seems, totally opposed to the idea of relaxing so many crucial rules for Apple. One of the officials said, “We have not done this for anyone. If we do this, we must see a lot of value addition.”
Another official said, “Apple is coming here because it sees a lucrative market, this is not a favour being done to India.”
But Why Govt. Is Considering Apple’s Demands?
Apple is a big brand, and its presence in India for manufacturing will give a huge boost to Make In India campaign. And precisely this is the reason that Govt. of India wants Apple to open up their factory, even if that means relaxing few rules, and giving them 15 year tax holiday on import.
In fact, voices have started coming up from the Indian camp, wherein Apple’s demands are even being justified. One official said: “Our import duty is high. As long as they are getting into exports, our objective should be to give them lowest duty so as to ensure that their product is competitive.”
However, relaxing rules for Apple can open up a Pandora’s box, as other phone manufacturers too will want a slice of this red carpet rolled out for Apple.
Arvind Vohra, CEO of Gionee India, part of Chinese smartphone maker Gionee has said, “What Apple is trying to do, if it happens, I think it will be available to everybody in the industry. I don’t see the government of India making discriminatory policies,”
The ball is in Govt. of India’s court now, as Apple has fired the shot. And the audience includes a dozen or so foreign manufacturers, who have earlier set up manufacturing units in India, by paying all the taxes and surcharges.
Which way will the game move now?
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