Apple’s Make In India Drive: Is Govt. Of India Ready To Exempt Apple from GST?

India is the 2nd largest market for smartphones in the world, yet Apple, the world’s second-largest mobile maker hardly caters to 2% of the consumers here. Recognising the significance of Indian market, the iPhone maker Apple sought for some concessions from the Indian government under make in India policy. The concessions reportedly included duty exemption on its products and services for a period of 15 years. However, the Finance Ministry had earlier rejected the proposal saying that any exemption regarding CGST and SGST is not in their hands, but in the ambit of GST council.

In a related development, speaking to the reporters at the World Economic Forum event, DIPP Secretary Ramesh Abhishek said that the government is, in fact, sleeping on the considerations proposed by Apple to make in India. However, is bringing Apple to India is really a big deal? “Currently, there are 90 phone companies manufacturing their electronic gadgets in India and hence make in India is already going strong,” said Abhishek.

Make in India campaign has attracted big companies from across the globe, be it Airbus, Huawei, Foxconn, Mercedez-Benz, and the UK’s BP. “The policy is going to be a trend-setter and guiding stone for the next 10-15 years. Since Smart Manufacturing is an important aspect of Make India, we would like to give it enough time. The committee will give its report by November,” said Ramesh.

On reforms, Ramesh said that in 2017 alone, almost 200 reforms have been done pertaining to Invest India strategy and the same has been informed the world bank too.

For the past few years, Apple has been assembling some of selected iPhone models in India.  However, to manufacture in India, Apple had sought for 30% tax exemptions for local sourcing of components from the revenue department and department of electronics and telecommunication.

India is the second largest market for smartphones. But the average cost of the mobile phones being sold here is $150. Apple in its application has also averred the fact that it would be bringing in a host of ancillary units while setting up its plants to manufacture in India.

Apple To Make In India: What Does That Mean?

Bringing Apple to India will create thousands of jobs and boost India’s ‘Make In India’ campaign as Apple is one of the most valuable brands in the world. On the other hand, it will also decrease the Apple’s dependency on Chinese/Taiwanese manufacturers like Foxconn. In past, there were incidents reported that underage people were being employed to manufacture iPhone at a lower cost. This attracted a worldwide criticism. Also, world’s largest mobile maker Samsung has been catering to the largest share of the Indian market by manufacturing here. With Apple developing and manufacturing smartphones locally, it will have a better opportunity to understand the local market and design thinking accordingly.

(The development was reported by ET)