Apple must sell local made goods to set up stores in India

Apple's expansion plans in India has hit a major road block as the the government has reportedly rejected the Cupertino giant's plea of exempting 30 percent local sourcing norm to open Apple retail stores in the country. Reuters report that, Apple must sell at least 30 percent of locally sourced goods in order to the Apple stores in the country.

Apple for a long time has been trying to open its official retail stores in India, and earlier this year, the company had filed a proposal with Department of Industrial Policy and Promotion (DIPP) following which it had to resubmit the proposal with necessary changes and additions in March.

According to norms of the DIPP, 100 percent FDI (foreign direct investment) has been allowed for single-brand retail. But a manufacturer must source 30 percent of the value of goods sold in the store that should be made in India. A waiver is also available provided the company has made some investment in "state of the art" or "cutting-edge technology" in the country. Apple has applied for the waiver, but had not yet provided any materials and records to justify it.

For Apple, its presence in India is of strategic importance because India is the second largest smartphone market in the world. Currently, Apple's market share in the country is low at just 2 percent.

Apple recently in a move to strengthen its presence in the country announced that it will be setting up a new iOS app design and development accelerator center in Bengaluru, which will be operational in 2017. The company also plans to setup manufacturing plants in the country as well. Only time will tell if all this is enough for Apple to set up its retail stores in the country. 

Source | Via