Iphones will start being assembled in India as soon as the next three to four weeks. Apple’s contract manufacturer Wistron Corp will most likely start making the iPhone 6 and 6S models at its plant in Bengaluru.
A government official also told WSJ that almost all preparations are in place to launch Apple’s first phase project in India through Wistron. Apple’s cheapest model, the SE will also be added to the line in around three months.
This comes at a time when most of the demands on tax incentives made by Apple have been rejected by the Indian government.
According to a report in the Economic Times, in a reply to a question in the Parliament, Commerce Minister Nirmala Sitharaman said, “Apple India has sought concessions, including duty exemptions on manufacturing and repair units, components, capital equipment including parts and consumables for smartphone manufacturing and service/repair for a period of 15 years,”
On whether the government has accepted most of the demands, Sitharaman said "No”
Apple was in talks with the government to incentivize high-end component makers of iPhones to set shop in India. It sought several exemptions with regards to import duties on components and equipment. It further wanted to be exempted from the norm that states that 30% of sourcing should be done locally.
However, the ET report says that this rejection will not affect the Bengaluru plant as the concession demands do not pertain to it.
India has been a growing market for Apple. Smartphone shipments in India grew 18% last year as against a 3% growth globally, as per counterpoint research.
Faisal Kawoosa, analyst with research firm CMR told Business Standard that making the phones in India would allow Apple to lower prices by at least $100 as its import tariff bill comes down.