Setback for Apple, must comply with 30% local sourcing regulation to open stores in India: Bloomberg
The report cited sources as saying Arun Jaitley supported a board's decision to not exempt the tech giant from the rule enforced on foreign retailers.
Apple Inc.’s plan to open stores in India has hit a roadblock. Finance Minister Arun Jaitley has decided to support India’s Foreign Investment Promotion Board’s stand that the company must comply with rules related to local sourcing of raw material in the country, Bloomberg reported, citing sources familiar with the matter. The decision comes days after Apple CEO Tim Cook’s visit to India.
The tech giant had sought an exemption from India’s regulation, which stipulates that foreign single-brand retailers must procure at least 30% of their components from local sources if they want to open stores in the country. Apple had reportedly applied for an exemption that sets aside the rules for firms that bring cutting-edge technology to the country that cannot be easily duplicated by Indian manufacturers. However, the board decided that Apple does not meet the criteria.
Apple currently manufactures most of its handsets in China. So far, it has sold iPhones only through third-party retailers. Foreign retailers face strict regulations in India, as part of efforts to attract manufacturing jobs to the country instead of merely allowing them to sell products in its market.