As per a statement coming out from top government officials, the Indian Government has invited Apple to import the products required for manufacturing the mobile phones in the local market completely tax free. The rebate on tax will however be dependent on the additions the company makes to local values over the course of time.
The news come from Reuters.
Ravi Shankar Prasad, the union minister for Electronics and IT, said on Tuesday that Apple is looking forward to expand its contract manufacturer’s facility in the Indian Silicon Valley, Bengaluru, because the smartphone behemoth is planning to firm its hold on one of the world’s largest smartphone markets.
The Cupertino giant began the manufacturing of iPhone SE in Bengaluru, at the manufacturing plant of its Taiwanese contract manufacturer Wistron.
In the March quarter, Apple sold more than 50 million iPhones round the globe, and yet suffered a downfall of 1% year-on -year. This has motivated the company to shift its focus towards India, since other major markets are completely saturated.
Speaking of the tax concessions, Apple has initially bagged a 15-years tax holiday for all the components it needs to import in order to construct a research facility in India.
Aruna Sundararajan, Secretary at the Ministry of Electronics and IT disclosed that many ministers rejected this preposition and demanded for a bigger share of the local firms in the manufacturing processes.
While speaking with Reuters, Sundararajan said;
We have offered them tax exemptions on those components which could not be manufactured in India.
Apple has agreed to increase the contribution of local firms in the manufacturing process, however, some differences remain to exist among the parties on he subject of manufacturing, she said.
Ravi Shankar Prasad has previously stated that the government officials have been in touch with Apple and other mobile phone manufacturers on the subject of starting a new manufacturing facility in India.
The official said:
It will be a little early to say that India and Apple have agreed on the common ground.
The industry reports have provided estimates that the value of the smartphones produced in India this year was somewhere around 900 billion Indian rupees ($13.90 billion), against the 540 billion rupees last year.
