Apple is apparently close to sealing a deal with India for a local manufacturing plant, which could translate to more affordable iDevices.
The company confirmed that it had a "constructive" meeting with the Indian government, discussing plans to open a facility in the country. This follows reports from earlier this month indicating that Apple was about to have a high-level meeting to ask the Indian government for concessions so it could manufacture products locally.
The list of demands Apple had for the Indian government included a waiver on custom duties, as well as extensive tax breaks.
According to a new report from Reuters, it now seems that the meeting took place and it was quite lucrative, albeit the two parties have not finalized any agreement just yet.
"We've been working hard to develop our operations in India," Apple tells Reuters. "We appreciate the constructive and open dialogue we've had with government about further expanding our local operations."
Affordable iPhones Made In India?
Apple has been trying to build an iPhone assembly factory in India for quite some time now and Apple products made in India could cost significantly less. India is among the world's fastest-growing smartphone markets and locally made handsets could be notably more affordable. Currently iPhones are simply too expensive for the vast majority of Indian customers, but things would be different if they were manufactured locally.
However, Apple is only willing to build a factory in India if the country agrees to loosen some of its rules for local businesses. One of those rules requires manufacturers to source at least 30 percent of all components locally, and that would be quite tough for Apple.
Apple Demands
India agreed to bend this rule for the first three years when new businesses start operations in the country, but Apple is looking for more leeway. Three years is not enough to get Apple on board, and the company has also asked for a waiver on customs duties for both used and new equipment. Moreover, Apple also wants full exemption from expenses on raw materials.
The company has also asked for a 15-year tax break on component and equipment imports, as well as looser rules when it comes to product labeling. Apple may not be too strict in meeting each and every one of these demands, but it will not give in easily either.
It remains to be seen whether the Indian government will eventually meet Apple halfway and agree to a solution that works for both parties, but the "constructive" meeting suggests that they're nearing some sort of common ground.
Should they reach a final agreement, having Apple products made in India could be great for all parties involved. India would get a global company setting up shop locally and creating many jobs, Apple would expand to one of the fastest-growing smartphone markets, and consumers would be able to purchase iPhones and other Apple devices at considerably more affordable price points.
For now, all we can do is wait and see if a deal materializes. As always, we'll keep you up to date as soon as more information becomes available.
