{"id":1447,"date":"2016-06-22T04:03:00","date_gmt":"2016-06-22T04:03:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=1447"},"modified":"2022-09-01T04:10:22","modified_gmt":"2022-09-01T04:10:22","slug":"apple-free-to-take-bite-out-of-india-after-fdi-rule-change","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/apple-free-to-take-bite-out-of-india-after-fdi-rule-change\/","title":{"rendered":"Apple free to take bite out of India after FDI rule change"},"content":{"rendered":"\n

AFP\/The Hindustan Times
\nNew Delhi, 22 June 2016<\/i><\/p>\n

\n
\n

<\/p><\/div>\n

\n

The\ngleaming glass atriums and blue-clad “geniuses” that herald the arrival\nof an Apple store could soon be landing in India, after the government\ncleared the way for it to open in the rapidly growing smartphone market.<\/p>\n

\nBefore now, the Silicon Valley giant has been just a bit-player in the\ncountry of 1.2 billion, selling through local shops with none of its\nown.<\/p>\n

\nIt applied to open stores in January, but was reportedly rebuffed\nbecause of a diktat that states foreign retailers must source 30\npercent of their products locally.<\/p><\/div><\/div>\n

\nBut on Monday New Delhi relaxed the rules, just weeks after Apple chief\nTim Cook toured India on a breathless charm offensive where he was\npictured using Prime Minister Narendra Modi’s gold iPhone to launch the\npremier’s own app.<\/p>\n

\nCompanies making state-of-the-art technology — understood to include\nApple — now have up to eight years to meet the sourcing requirements\nunder a waiver, part of a push by India’s pro-business government to\nattract foreign investment and create jobs.<\/p>\n

\nFor Apple, which saw iPhone sales dip for the first time ever in the\nsecond quarter due to slowing demand in China and the United States,\nIndia is a tantalising prospect.<\/p>\n

\nWhile analysts say it currently accounts for only around one percent of\nglobal iPhone sales, its giant population and low number of smartphone\nowners relative to its size mean it is a huge potential market.<\/p>\n

\n“Apple has\nnot really seen India as an important enough market in the past, but\nsomewhere, the penny has dropped,” Devangshu Dutta, chief executive of\nretail consultancy Third Eyesight, told AFP.<\/span>\n<\/p>\n

\nApple’s vast, hands-on stores are designed to become destinations in\ntheir own right, analysts say, luring potential customers with the\npromise they can play without buying.<\/p>\n

\n“The store is\nnot just a place to do business — it acts as a live billboard for the\nbrand,” Dutta said.<\/span><\/p>\n

\n‘Cost-conscious\nmarket’<\/span><\/p>\n

\nBrowsing mobile accessories in FutureWorld, a technology retailer in\nNew Delhi’s Connaught Place, Aryamaan Chauhan said he would\n“definitely” visit an Apple store if one opened in the city.<\/p>\n

\nThe 19-year-old IT student owns an Android smartphone, bought for about\n20,000 rupees ($295), but is considering switching loyalties.<\/p>\n

\n“Money is what’s stopping me. My budget is low, I can’t afford it,”\nChauhan said.<\/p>\n

\n“Now, I think most Indian people prefer Android but they are shifting.\nAfter graduation I will buy an iPhone.”<\/p>\n

\nWith a basic iPhone starting at almost $600 — more than in many\ncountries, thanks to India’s high taxes — they are wildly unaffordable\nfor most in a nation where average incomes are less than $1,600 a year.<\/p>\n

\nHandsets costing under $100 dominate the market, many of them made by\nChinese manufacturers such as Xiaomi or Huawei.<\/p>\n

\n“It won’t become mass-market, (Apple) will always be a niche player.\nThis is a very cost-conscious market,” Vishal Tripathi, research\ndirector at Gartner, a technology research firm, told AFP.<\/p>\n

\n“But there is a growing number of consumers who like Apple.”<\/p>\n

\nBy pricing itself exclusively at the luxury end, Apple has\ndistinguished its brand from arch-rival Samsung which has both low-cost\nand high-end phones.<\/p>\n

\n“Indian consumers are always under the notion that more expensive means\nbetter and consider carrying an iPhone as more of a status symbol than\nanything,” said Bhasker Canagaradjou, the head of Ipsos Business\nConsulting in India.<\/p>\n

\n“The brand enjoys a very strong aspiration value, especially among the\nyoung population.”<\/p>\n

\n‘Make in\nIndia’<\/span><\/p>\n

\nFor now, Apple has given no indication when or if it plans to open its\nown stores. But if it does, it will eventually have to meet strict\nsourcing rules as the government exhorts companies to manufacture in\nIndia.<\/p>\n

\nThe company will require factories that can produce its exacting,\ncutting-edge products — something India largely lacks.<\/p>\n

\n“To create a\nlocal supply chain, it takes time. They will be able to operate stores\nand benefit from stores in the meantime,” said Dutta.<\/span>\n<\/p>\n

\nFoxconn, the major Taiwanese Apple supplier which also assembles\nproducts for Sony and Dell, is spending billions of dollars setting up\nfactories in India.<\/p>\n

\nThe iPhone is not yet on the production line, but Canagaradjou says he\nbelieves Apple could start manufacturing in India “in the next one or\ntwo years”.<\/p>\n

\nHowever, while its stores may arrive in India soon, analysts don’t\nexpect to see legions of Apple superfans camping out to buy new\nreleases as they do in other countries any time soon.<\/p>\n

\n“If someone is expecting a replication of how it is in other markets,\npeople queueing up outside the stores from 3:00 am, I don’t think\nthat’s going to happen,” said Tripathi of Gartner. “In India, people\nprefer to sleep until late.”<\/p>\n

\n<\/span>(Published\nin Hindustan\nTimes<\/span><\/a>)<\/i>\n<\/p>\n","protected":false},"excerpt":{"rendered":"

AFP\/The Hindustan Times New Delhi, 22 June 2016 The gleaming glass atriums and blue-clad “geniuses” that herald the arrival of an Apple store could soon be landing in India, after the government cleared the way for it to open in the rapidly growing smartphone market. 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