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With Relaxations In FDI Norms, Apple Might Come Up With Its Fully Owned Stores Soon

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Apple products — obviously are available in India in exclusive stores, but people are yet to experience the “real Apple buying experience” as all these stores are run by the Cupertino giant in partnership with Indian distributor outlets like Croma Retail.

Things may change in future as the overall business and investing environment in the country has been experiencing a slow but visible change with the efforts of the current Government.

According to a report by ET, Department of Industrial Policy and Promotion (DIPP) is now considering to relax the rules related to the compulsory local sourcing by foreign companies who want to open their own stores in India. The government had allowed 100% FDI in single brand retail in 2012.

However, for brands looking for more than 51% FDI, there is a condition that they have to source 30% of the value of goods from local sources  preferably from micro, small and medium enterprises (MSMEs), village and cottage industries, artisans and craftsmen.

This rule although imposed with a motive to protect the domestic businesses and to prevent the Indian market from becoming a dumping ground of imported products, has deterred high-end, hi-tech, single-brand retailers from opening their own stores in India despite their popularity in Indian markets.

Apple too reportedly expressed its inability to meet the 30% sourcing demand to DIPP and has even reportedly talked to Finance ministry and PMO regarding the same and it seems like, the policy makers have considered some changes.

It is not practical to expect such companies to source 30% from India. Policy should not be a deterrent in these cases,

said a senior government official to the ET.

He further added that they want to make the process simpler and do away with unnecessary conditionalities to ease investment in India. DIPP is also working towards a less cumbersome FDI policy, currently burdened with numerous conditions, to help ease of doing business. Apple reportedly has refused to make any comments in this regard.

FDI in India already saw a 29.5% jump over the last year with India getting  FDI of $19.39 billion in the April-June period, according to government data. A lot has also happened as a result of the Modi visit to the Silicon Valley this year where he met prominent names in the region, including Apple CEO Tim Cook with whom he had discussed manufacturing in India.


 

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