Apple has reportedly sought various sops from the Indian government

The Dollar Business Bureau 

The government has not been taking any decision on Apple Inc’s wish-list with regards to its plan to establish a manufacturing unit in India until there is clarity on the tax incentives that will be accommodated in the upcoming goods and services tax (GST) regime. 

Aruna Sundarajan, Secretary, Ministry of Electronics and IT said on Friday that a decision on tax incentives to Apple can only be taken when tax rates under the GST regime are finalised. 

Sundarajan said that the GST is still in the evolving stage. Apple is asking a favourable duty regime, to make it profitable for them to manufacture in India. Therefore, it needs to be looked into how favourable should that something be. But the main thing is to see in what manner this would be reflected in the upcoming GST regime. 

“Therefore, once the GST council decides on how the prevailing trade regime is going to get converted into new one and the incentives for domestic manufacturing are going to get reflected in the GST after that only a decision can be taken on Apple’s demands,” she added. 

Apple, as one of its preconditions to start manufacturing in India, had previously asked the government that it wants to use its unit in the country for exporting its “certified pre-owned iPhones”, in addition to making new devices. The proposal is with the environment ministry for consideration. 

To begin, the US tech giant is planning to establish a ‘pilot project’ near Bengaluru, and the extent of manufacturing depends on the kind of incentives the government is willing to provide to the tech giant. 

The iPhone maker has reportedly sought various sops from the Indian government, that includes a customs duty holiday for 15 years on the imports of iPhone kits, used and new capital equipment and consumables. 

Apple also wants duty reduction on components used in re-assembling of products under the finished products manufacturing unit. It has also put in a demand for relaxation of 30% domestic sourcing requirement which is needed under FDI rules. 

Till date, the American giant has not given any commitment on the investment or manufacturing prospects and job creation in the country to the government.