American multinational technology firm Apple Inc. has once again submitted its application to DIPP (Department of Industrial Policy and Promotion) to open company-owned retail outlets in India. The company failed to get an approval in the last attempt as it missed some information in the filing.
DIPP has asked the company to re-submit the application due to the incomplete information and its fresh application is now under procedure by the department.
After the government dropped compulsory 30% local sourcing rule for companies, Apple has applied for permission using cutting-edge technology. Its filing apparently didn't have details of investment and the number of stores it wanted to open.
Currently the American firm sells its products in India through the franchise model. The government allowed 100% foreign direct investment in single-brand retail in 2012. Up to 49% of such investment can be made through the automatic route and beyond that with the approval of the Foreign Investment Promotion Board.
For proposals envisaging FDI beyond 51%, at least 30% of the value of goods has to be sourced from India, preferably from micro, small and medium enterprises, village and cottage industries, artisans and craftsmen.
The company finds it difficult to operate with mere 30 percent sourcing rule given the technology it provide for the products.
In order to provide high-end single brand entities an easier access to operate in India, the government last year decided to give a relaxation in case of state-of-the-art and technology which is subject to approval. This initiative was taken to reform the FDI norms with an intention to scale manufacturing and employment activities in the country.
As per filings with Registrar of Companies, Apple posted a 44% increase in sales in India at Rs 6,472.89 cr in the last fiscal, and its net more than doubled to Rs 242.85 cr.