Even though India is home to 1.24 billion people and is part of the emerging BRIC markets, high import taxes and a number of other factors have contributed to often too high prices of consumer electronics products such as smartphones. The off-contract iPhone 4S which costs $450 in the United States, for example, used to be desperately out of the reach for most of that nation’s consumers.

Realizing its mistake, Apple has tweaked its pricing tactics in the country and started offering installment plans and other benefits. According to a new report, the iPhone maker also decided to eat into its high iPhone margin in order to preserve the current iPhone pricing in India whereas Samsung has chosen to raise prices due to Indian rupee’s unprecedented plunge…

According to Bloomberg:

Apple has refrained from following Samsung Electronics Co in raising prices.

Apple is selling the iPhone and iPad to distributors such as Redington India Ltd. (REDI) at the same price as in 2012 even after the currency’s decline this year, Rajesh Khetarpal, head of Redington’s strategic business unit, said in an interview.

Of course, Apple has lots of margin to work with.

With two to three times higher handset margin than its competitors, small wonder the company was able to absorb a notable fourteen percent hit in the value of the rupee.

An IDC analyst told Bloomberg:

Even though Apple’s margins in India may be adversely affected, volumes are low and this strategy could pay off if stable prices lure new buyers. This could be a wise move in India, especially if competitors increase prices.

This is much welcomed news for Apple’s fans in India, especially knowing Apple has locked itself in a price war with bitter rival Samsung. iStore India, an Apple reseller, currently sells the off-contract 16GB iPhone 5 for 45,500 rupees, or approximately $709.

By comparison the Galaxy S4 costs 41,500 rupees, or about $645, according to Samsung’s local website. IDC estimates that the average selling price for smartphones in India will fall below $200 by the end of 2013.

In order to boost sales in the country, Apple earlier this year started offering interest-free credit deals through its distributors and student discounts, which helped triple sales and increase the company’s minuscule market share by 400 percent.

Currently, Samsung leads the smartphone market in India, followed by Micromax, Karbonn, Nokia and Sony. The iPhone maker sits at the sixth place.

India is important because it is part of the BRIC bloc (Brazil, Russia, India and China).

These countries are expected to overtake the United States as the world’s top smartphone markets by 2018. According to IDC, India will replace the U.S. as the second-biggest smartphone market by 2017.

Later today, Apple is expected to unveil the rumored mid-range iPhone 5C designed to improve market standing in countries like India, China and other markets where carriers don’t subsidize handsets.

It is estimated than more than half non-US smartphone users are on prepaid plans, so a $350-$450 device could go a long way toward expanding Apple’s addressable market.

  • Adnan Mosali

    Honestly , at this point I really don’t care .. Anything new about the keynote ?!

  • Dev Shah

    I’m An Indian And This Post Made My Day..!!! 😀 Although The iPhones Were Highly Overpriced Here in India And Without Any Carrier Subsidies It Added More Burden. It Will Be Interesting To See What Would Be The Price Of The 5S & 5C After The Rupee Has Started To Regain.! 🙂

    • kalpesh

      seriously 70k for 5s would hav been a shocker

      • Dev Shah

        If The 5S Would Still Be Available For 45-47Ks, It Would Definitely Lure More Customers. Go Apple. 😀

      • Sean Cua

        Please fix your capitalization.

      • Dev Shah

        Hehehe Its not due to “capitalization” :P, I do that involuntarily as i’m habituated to text like that.

      • Yaseen AlSuwaidan

        It is wrong. So, don’t. 😉

    • Abhinav Chaudhary

      Why is your every first letter in caps?

  • mayankgarg99

    i like the decision of not increasing the price in India, as HTC launches Butterfly S at very high price (rs. 54000) , apple should release iphone 5S at low price only

    • D.

      “5S at a low price”


  • abdullah575

    Is iOS 7 GM will realse for all users today???

    • Qasim Bashir

      u are not even sure of that? what happened to your 1000000% reliable info

    • Jay Kay

      Yup & public release on 20 sep

  • Abhinav

    “India will replace the U.S. as the second-biggest smartphone market by 2017.”

    really ?

    • Jay Kay

      Yup with Nokia 1200

  • Pawan

    I believe it would be foolish of any company to not keep any leeway while deciding pricing in foreign markets in order to account for currency fluctuations. Besides Rupee’s slide will be checked soon.

    Some perspective :

    iPhone 4 was launched at Rs 34,500
    iPhone 5 was launched at Rs 45,500

    If the Rupee were to stabilize at a lower value (unlikely), Apple would eventually have to raise prices, Just like it did with 4S & 5

  • reallydontcare

    In Portugal an off-contract 16GB iPhone 5, sold by Apple (website) costs $927. At an Apple reseller it costs $1059 ! I wish I could pay $700 for an iPhone… 🙂

  • rasengan720 .

    Haha the budget iPhone isn’t budget anymore and besides if they don’t bring the prices down or make a cheaper version of iPhone to sell, no mater what plans apple comes up with.. It’s still not enough to boost iphone sales here in india