Industry can meet Apple’s components wish list for iPhones on purchase assurance: IESA

Apple has submitted a proposal for setting up single brand retail stores in the country, but has sought exemption from the local sourcing norms as the US-based giant makes state-of-the-art and cutting edge technology products for which local sourcing is not possible.

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The Finance Ministry has rejected relaxing the 30 per cent domestic sourcing norms, as sought by iPhone and iPad maker as a pre-condition for bringing in FDI to set up single-brand retail stores in the country.

However, the Ministry of Commerce has taken a line that the 30 per cent local sourcing requirement can be waived off for high-end technology products and will again try for exempting Apple from this norm.

If you make an exception to Apple, everybody will come and ask for similar differentiation. Such kind of request will only multiply. Any kind of dilution will adversely affect us,” Vidyashankar said.

He said that industry associations have met all concerned ministries at high level in Finance, Commerce, Department of Industrial Policy and Promotions and Communications & IT.

“Industry bodies have expressed their views that there should be no dilution on this,” Vidyashankar said.

He, however, said that Apple entry in India is very important for industry and country.

“Their coming is very important for us. If we can say we are supplying to Apple, all the leading players will fall in line. With China saying that they are supplying to Apple, the credibility touches sky high. We need to be almost equal to that kind of dispensation but there should be no dilution,” he said.

He said that industry can cater to need of Apple if business is assured from the iPhone maker.

“If someone is heading an organisation who has 200 companies and now these 200 companies are given an order with assurance that components will be sourced from them for next three years. It can be easily done …that’s what we are looking at,” Vidyashankar said.

When asked that India still does not has electronic chip manufacturing plant which is a very key component for making smartphones, Vidyashankar said that industry can start with some percentage and then ramp up.

“We need not start with semiconductors. There are hundreds of item where we can satisfy. Out of over 2,000 item required in an iPhone, we can start with 200. Starting from packaging, PCBs, battery to what not but as I said it will take sometime,” Vidyashankar said.

He added that even in Indian automobile sector not 100 per cent of vehicles are made in the country and same is the case with China.

“Even in China, they also source components from various locations,” Vidyashankar said.

Apple’s products are made Taiwanese electronics manufacturing giant Foxconn in China. Foxconn has set up its manufacturing unit in India but it is engaged in making mobile phones of mostly China-based companies here.