Indian Government Unwilling To Give In To Apple’s Demands For Concessions

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Indian Government Unwilling To Give In To Apple’s Demands For Concessions
Indian Government Unwilling To Give In To Apple’s Demands For Concessions

Apple is continuing to face opposition from India’s taxation authority with regards to its demands for expanding iPhone manufacturing in the country

The company has asked for a host of concessions including lower taxes on imported components, relaxation in local part sourcing requirements and government assistance in capital – all of which the Indian government is refusing to accede, according to a Reuters report.

Apple is said to be considering adding upto 10,000 jobs in India as a part of the expansion of its current manufacturing base.

No Exemptions For Apple   

According to sources, the Indian government has told Apple that there would no exemptions extended to it outside of existing policy and also that there will be no addition breaks on the current 10 percent tax imposed on imported parts.

A report developed by the country’s information technology ministry is said to have noted that Apple’s demands “may not be feasible” to implement.

One source told Reuters that Apple want duty-free importation of components, but India wants “indigenization.”

The assembly of iPhone SE phone model started this year In India in May at the company’s Wistron facility in Karnataka.

Indian government officials are hoping that prices for the iPhone SE will be cut by almost $100 in the local markets, but Apple is likely to avoid too large a reduction in order to safeguard its margins.

Apple Looking To Expand Reach in India

The first IPhone SE models made in the country went on sale across India In June this year, bearing the message  “Designed by Apple in California, Assembled in India.”

In terms of the sales channels , Apple is looking at setting up flagship stores in major cities of New Delhi, Mumbai and Bangalore, which have a concentration of affluent consumers.

These stores would be over and above the expansion of Apple Authorized Reseller program which Apple was reportedly considering in March.

Speaking at the recent Apple earnings conference call Apple CEO Tim Cook noted that there was “great momentum” in India, but the company was still in the process of “gaining understanding” of the market.

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