Make in India: Govt wants Apple to come out with a 'workable solution'

As the government is keen to resolve the issue concerning US tech giant Apple's manufacturing plans in India, it has asked the iPhone maker to come out with a 'workable solution' so that it can be given incentives within the framework of current policies.

Sources said the government was considering several options including giving space to Apple or its manufacturing partners for making iPhones and other devices in the special economic zones (SEZs), so that the company could benefit from duty incentives. However, the problem with manufacturing in SEZs is that Apple will not be able to sell its products in the domestic market.

"The government is committed and is exploring various options for Apple within the current set of rules. We have to see what proposal Apple brings to the table," a source in the Ministry of Electronics and IT (Meity) said.

Things have started to move again for Apple ever since Meity has become the nodal ministry. Earlier, the Commerce and Industry Ministry was handling the matter and it had rejected demands of Apple seeking duty concessions.

Apple did not respond to a query from Business Standard.

A few meetings between Apple and Ministry officials have already taken place and more are scheduled in the coming days.

Earlier, the government had maintained that it would not offer any concessions specifically to Apple to produce smartphones locally. Instead, it was exploring concessions to benefit all smartphone makers seeking to set up manufacturing operations in the country. The government had also rejected Apple's request to set up local plants to refurbish used iPhones, which it intended to offer to local customers at lower prices.

Earlier this year, Apple had sought duty exemptions on the products to be bought from SEZs. Currently, goods exported from SEZs do not attract any duty but import duties are levied if items produced in such zones are sold in the domestic market.

Apple had also requested the government to grant it 15 years of duty-free import of components to assemble iPhones in the country, sharing a road map to slowly indigenise products.

The firm is looking at India as its next big market and its revenues from the country has also been growing while iPhone sales have begun dropping in its two largest markets - the US and China.