Apple has been trying to set up single-brand retail stores in India from quite some time. The FDI rules have prevented Apple from offering a flagship Apple Store in India. Meanwhile, Apple tried to persuade the authorities and asked for an exemption under the ‘cutting-edge technology.’ category

In 2017 things started looking brighter as the Indian Government finally considered offering tax breaks for Apple to operate its own retail stores. Furthermore, it was learned that Apple might be allowed to start retailing in exchange for local manufacturing of products. The 2019 Indian Union Budget bears good news for Apple and other companies trying to set up a single brand retail store in India.

Nirmala Sitharaman, Finance Minister, India said “Global FDI flows slid by 13% in 2018 to $1.3 trillion from $1.5 trillion, as per the world investment report… India’s inflows remained strong at $64.37 billion marking a 6% growth over the previous year. I propose to further consolidate the gains in order to make India a more attractive FDI destination” she also added that “Local sourcing norms will be eased for FDI in the single brand retail sector.”

Until now India mandated that single brand companies looking out for more than 51% foreign investment should compulsorily source 30% of the products locally. The Indian Government is likely to attract new investments and increase growth by attracting large single-brand retail companies.

Prabhu Ram, head of Intelligence group at Cybermedia Research said “The relaxation of mandatory 30% local sourcing norm will spurt the growth of the Indian economy, and will potentially help in attracting large players in the single-brand retail sector, including the likes of Apple.

Apple is facing dire prospects in India. The company is in one of its weakest years in 2015 with iPhone shipments taking a plunge by 42%. Meanwhile, Apple is ramping up its local production in India. The Cupertino company has asked Foxconn, Pegatron, and Wistron to move a certain part of their production to India.

[via Economic Times