Govt. Denies Apple Special Treatment; Apple’s Dream Of Manufacturing In India On Hold
Apple had asked for a 15 year custom-duty holiday among other demands.
Apple, world’s most valuable technology company, will have to abandon their plans of manufacturing their iconic products in India. Govt. of India has firmly denied their request for special treatment and special permissions.
Does it mean that it is the end of road for Apple?
Will they continue their assembling in India, or that too will be shut down?
We investigate..
Govt To Apple: Sorry, No Special Treatment For You!
An unnamed Govt. source, most probably from DIPP has revealed that Govt. is in no mood to allow Apple’s request for special treatment, in order to start their manufacturing process in India.
As per that official, Govt. wants Apple and other tech majors to start their full fledge manufacturing under Make in India campaign, rather than adopt a partial approach wherein they import certain components from outside, at special discounted tax slabs, and then manufacture/assemble the complete unit in India.
It seems that the Govt. want their full participation in the Make in India campaign, rather than half-hearted approach.
He said, “We have already hiked customs duty on smartphone and imports of its parts. So, it is clear that we do not want to encourage imports and rather encourage Make in India.”
Besides, under the GST regime, it would be really tough to provide special tax rates and exceptional discounts to one particular company, even if that company is Apple.
He said, “With the Goods and Services Tax (GST) in place, giving separate exemptions to anyone is not possible..”
This means that Cupertino-based tech major won’t be able to kickstart their manufacturing units in India, and this is bad news for them.
Interestingly, right now, around 90 phone manufacturers are manufacturing their handsets in India, under Make in India campaign.
Apple’s Special Treatment: How Justified Was That?
According to business logic, that made perfect sense; but if we observe these requests based on a neutral, social lens, then it seemed a bit unjustified, especially when more than 90 manufacturers are already manufacturing their phones in India, without any hassles.
Talks about Apple’s local manufacturing and local sourcing gained momentum last year, when they requested special treatment for opening their own retail stores in India.
However, Govt. denied them any special relaxation for opening their own stores.
This year, in January, Apple demanded 15-year custom duty holiday, along with several special permissions like:
- No additional tax or surcharges under GST regime
- Swift processing of Apple’s Advance Pricing Agreement by Income Tax Dept.
- Custom Dept. should execute “Always Open” clearance process for faster movements
- Suspension of ‘Integrated Goods and Services Tax’ at the point of importation
In August, reports emerged that Govt. that considering Apple’s request with an open mind, and some rules and regulations can be tweaked to favor them.
But now, it seems that this special treatment and special requests won’t be entertained after all.
Do you think Apple deserves tax holidays and other benefits for manufacturing their products in India? Do let us know your opinions by commenting right here!
