India relaxes rules on foreign direct investments, paving the way for Apple Stores

Tim Cook in India

The government of India has relaxed its strict rules on foreign direct investments, which stipulate that 30 percent of goods sold by foreign companies must be manufactured or produced within India, paving the way for Apple’s retail expansion in the 1.25 billion people market. Acording to The Times of India on Monday, Apple should benefit from a new three-year relaxation on local sourcing norms.

Moreover, Apple could be given an extension of up to five years should it prove that its products are “state of the art”.

“The panel comprising representatives from departments of industrial policy and promotion (DIPP) and information technology had recommended a waiver from the 30% sourcing norm on the ground that Apple’s products were ‘cutting-edge’, which allows for doing away with the domestic procurement rule,” reads the article.

Apple reportedly said it won’t set up retail stores in the country unless the government exempts it from sourcing materials locally.

Apple’s plans to open first company-owned retail stores in the country was shot down last month by the Foreign Investment Promotion Board, which opposed relaxing the local sourcing norm for Apple to sell its products through its own stores in the country.

Thus far, Apple’s been selling iPhones in India through third-party resellers and select retail partners.

Source: The Times of India