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The Indian government has turned down Apple’s request to sell refurbished iPhones in the country after Samsung and local phone vendors voiced their opposition to the move on environmental grounds, Bloomberg reported today.

This is a setback for the Cupertino firm: its iPhone has a minuscule two percent markets share in India, where half of the population is about 25 years old.

iPhone woes in India

Apple’s iPhone woes in India are understandable—its handset is too pricey for the vast majority of customers in the country where 80 percent of phones cost less than $150.

By comparison, the iPhone SE starts at 39,000 rupees in India, or approximately $587, versus its $399 asking price over in the United States.

India was supposed to become the first country in the world where Apple itself would be officially selling refurbished iPhones. Import of other used goods, such as cars, are precluded by 300 percent duty levies.

To that extent, Indian Prime Minister Narendra Modi has kicked off a “Make in India” marketing campaign which is intended to boost local manufacturing.

Samsung mounts public campaign against Apple

Samsung and local phone makers like Intex and Micromax strongly opposed Apple’s proposed plan, citing potential damage to the environment caused by improper handling of outdated and used electronics in the country. Some folks even suggested that letting Apple import pre-owned iPhones into India would hurt local economy because Indians “may choose Apple for its snob value”.

A whopping 1.2 billion people live in India and it’s projected to become the world’s most populous country by 2020. Apple CEO Tim Cook said on “Mad Money” last evening that he counted on emerging LTE markets like India to help grow iPhone sales.

iPhone’s prospect in India

Apple sells its products in India through a network of resellers because local carriers don’t sell phones and it also lacks official retail presence there. Last quarter, the company saw a 56 percent iPhone unit growth in India and is seen making progress on opening its own retail stores there.

India’s Department of Industrial Policy and Promotion recently recommended exempting Apple from a state ruling that requires foreign companies to carry at least 30 percent of their goods from domestic suppliers in their own retail stores.

That decision is currently pending.

Source: Bloomberg