Easy concessions from government is a no for Apple

Amid reports that Apple is to soon start making iPhones in India, a top-ranking government official said the company's demand for exemptions as part of its investment plan will come under close scrutiny.

A high-ranking government source said, "No other company has made these demands which Apple is making, so why should they be given special treatment?"

Apple has sought concessions related to taxation, local procurement and labelling requirements, officials have revealed. During his visit to the country last year, Apple CEO Tim Cook had said India was the next big market for the company.

Prime Minister Narendra Modi had urged Cook to set up factories in India when they met during that trip. The government currently provides subsidies for investments in special economic zones in order to woo investors.

Apple had earlier sought permission to set up fully owned retail outlets by forgoing the compulsory 30% local sourcing norm on the grounds that it was bringing cutting-edge technology to India.

The finance ministry didn’t allow the exemption. Since then the company has drawn up plans for factories in India as it looks to shift some of its manufacturing from China, sources said. It manufactures products in six countries, with most of them being made in China.

The company is said to be planning to assemble phones in Bengaluru for the local market through a contract maker. Some reports said the company may also be considering plants in Ahmedabad and Gurgaon. Apple has refused to comment on such reports. Rivals such as Samsung have started sourcing parts from within the country while exporting products made at plants in Noida and Sriperumbudur.

The Department of Industrial Policy and Promotion (DIPP) has forwarded the iPhonemaker’s request to the Department of Revenue and Department of Electronics and Information Technology (DeITY). A group of senior officials from these departments will deliberate over Apple’s demands.

The government provides benefits under Modified Special Incentive Package Scheme (MSIPS) to boost electronic manufacturing in the country as it looks to reduce the import bill.