Opening Apple Stores in India has been something of a challenge for the company. The law normally requires companies to manufacture at least 30% of their products within India before they can open a single-brand store under a Foreign Direct Investment (FDI) rule, but TNW is reporting that a decision to liberalize the FDI deal will finally provide the go-ahead for Apple Stores.
If confirmed, the ruling will be an important one for Apple, which Tim Cook has described as the next China. An eight-year deal does, however, seem unlikely …
Apple will likely be allowed to avoid sourcing products locally for eight years – three years as per the new norms and an additional five years if it can prove it deals in ‘state-of-the-art’ and ‘cutting-edge’ technology that’s unavailable in the country.
While it was initially rumored that Apple was likely to benefit from the ‘cutting edge technology’ exemption, a later report said that this would not be the case. However, three years ought to be long enough for Foxconn’s $10B manufacturing plant to come online: the company estimated the total time from starting construction to production at just 18 months.
It should be noted that the source cited by TNW doesn’t explicitly state that the relaxed FDI rules clear the way for Apple Stores, and Apple has not yet commented, but the Times of India has said that Apple is ‘expected’ to benefit from the new terms. We will still need to wait for official confirmation to be 100% sure.
