Single-brand stores: DIPP panel suggests Apple be exempted from mandatory local sourcing

At present, Apple does not have any wholly-owned store in India and sells products through distributors such as Redington and Ingram Micro.

By: ENS Economic Bureau | New Delhi | Updated: April 28, 2016 9:21:34 am
 Apple India retail stores, Apple retail stores, India local sourcing norms, Apple stores launch, Apple,Apple retail stores in India, Redington, Ingram Micro, tech news, technology Apple has sought nod from the government on setting up single-brand retail stores in the country.

A committee headed by Secretary of Department of Industrial Policy and Promotion Ramesh Abhishek has recommended exempting Apple Inc from mandatory local sourcing, applicable for foreign direct investment in single-brand retail trading, a government official said.

Earlier this month, the Cupertino-based iPhone and iPad manufacturer gave a presentation to the DIPP Secretary-headed panel on why its products should be considered cutting edge and thus be exempted from mandatory local sourcing norms.

The company has sought nod from the government on setting up single-brand retail stores in the country.

At present, Apple does not have any wholly-owned store in India and sells products through distributors such as Redington and Ingram Micro.

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The government had set up a committee, comprising a representative from NITI Aayog and Department of Electronics and Information Technology, to decide whether an electronic product is ‘cutting-edge’ and can be eligible for exemption from the mandatory local sourcing applicable for FDI in single-brand retail trading.

An official with the DIPP said that before recommending relaxation of norms in case of Apple, several factors such as the innovations that the company made, those that were followed by other manufacturers, etc were considered.

The official also said that during consultations it was also discussed that allowing some relaxation to Apple could also help the company bring its product prices down.

The committee has made its recommendations. Now a call will be taken by the commerce minister first and then it will be sent to the finance ministry for clearance, said the official.

Currently, 100 per cent FDI is permitted in single brand retail sector but the companies are required to take Foreign Investment Promotion Board (FIPB) permission if the investment exceeds 49 per cent.

Apart from Apple, the official said that two other mobile device manufacturers Xiaomi and Le Eco have also sought the committee’s validation for its products to be cutting edge.

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