Prime Minister Narendra Modi’s cabinet is likely to approve a three-year exemption on local sourcing requirements for foreign brand retail companies categorised as “cutting edge technology”. Apple was previously told that it doesn’t meet that criteria, but it appears that Tim Cook’s personal meeting with Modi is helping the company: the government will make it easier for companies like Apple to meet that criteria, Bloomberg’s sources said.
To open a retail store in India, foreign companies must source 30% of components locally, as previously reported. The only companies exempt to this rule are those with “state-of-the-art technology”.
The sources cited by Bloomberg say Modi’s push to clarify those procedures will clear the way for Apple to open the first of its iconic retail stores in India in an effort to strengthen its position in the world’s fastest growing smartphone market. Apple currently controls only 2% of the Indian smartphone market, and needs to compete with manufacturers that sell devices for as low as $35. Last year 100 million smartphones were sold in the country, according to the latest data available.