Apple may start a trial of its proposed assembly unit in the industrial district of Peenya, Bengaluru in partnership with Taiwanese contract manufacturer Wistron without waiting for the government to decide on sops sought by the iPhone-maker to start local assembly.
According to an Economic Times report that quotes government officials from Karnataka, Apple has decided to go ahead with the trial run of the assembly. The state has also been pursuing Apple’s case with the Centre.
“We are working to see that (Apple) brings its entire component making ecosystem to Bengaluru and begins to export from here,” one of the officials was quoted as saying. “We are not much concerned about Apple making iPhones for the domestic market, which will happen anyway.”
The iPhone-maker has been seeking sops such as exemption of countervailing duty (CVD) on import of components that go into the making of iPhones and these sops are over and above what policies in place already provides.
The government offers several initiatives, including differential duty structure, modified special incentive package scheme (MSIPS) and zero-duty on import of all components except adapters, batteries and headsets, for global and local manufacturers, under Make in India.
“The application (of Apple) has not made much headway after passing through key ministries such as commerce, technology and finance,” according to a Karnataka government official who is of the view that the Centre may be concerned that such a waiver will not fit into the framework of the proposed goods and services tax that is expected to be rolled out from July 1.
He expects Apple will pursue its requests with the Centre independent of its Bengaluru plans “because India is a market it can ill-afford to ignore at this point”.
Apple is further expected to open up more facilities in India with other contract manufacturers later.