Government 'favourably' considering Apple's manufacturing proposal

The government is favourably considering the proposal of US-based iphone maker Apple, which plans to set up a manufacturing unit in the country. The proposal is with the the commerce and industry ministry and it is "favourably" considering the proposal, sources said.

"Although no final decision has been taken yet and the proposal has to be finally approved by the Prime Minister's Office but a few states are ready to welcome them," they said. Last month, Apple Inc had indicated to the government that it is ready with a blueprint to begin manufacturing iPhones in India but wants fiscal concessions, including Customs duty waiver on import of components.

With sales tapering in the US and China, Apple is eyeing India -- the fastest growing smartphone market in the world -- and looking to set up a local manufacturing unit to cut costs. It, however, does not manufacture devices on its own and rather does it through contract manufacturers. Besides exemption from the customs duty on imports of components and equipment for 15 years, Apple wants relaxation in the mandated 30% local sourcing of components.

As far as duty and tax-related concessions being sought by the company, most of them are within the policy domain and decisions would be taken by the respective departments. The company sells its products through Apple-owned retail stores in countries like China, Germany, the US, the UK and France, among others. It has no wholly-owned store in India and sells its products through distributors such as Redington and Ingram Micro.