Apple seeks 15-year tax holiday, other demands to make iPhones in India

Apple also wants the government to waive of custom duties to new new and used equipment brought into India.

Apple logo on display at it's office in California. Photo: Reuters

Apple which is about to meet government officials in New Delhi next week is all set to discuss the prospect of setting up manufacturing facilities in the country this year. But this is with a big condition, of asking the Prime Minister Narendra Modi-led government a long list of financial concessions.

One of the request of the world's most valuable company is a 15-year tax holiday on imports of components and equipment, according to a Mint report.

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While the government has made it clear that it wants Apple to set up shop in India, it has like for all single-brand retailers asked the company to adhere to the 30% local sourcing of components norms. The government has however relaxed it so that technology companies can operate stores for three years before meeting the requirement. This is in line with the PM Modi's vision of making companies manufacture in the country as part of the 'Make in India' policy, so that the country can create jobs.

However, Apple seems to be adamant and wants to have it their way. While Apple and the government officials have met on numerous occasions since last year, next week's meeting is expected to be crucial. This is as if the government gives into the Apple's demand it will set a precedent for other international companies such as Samsung and Xiaomi to ask for the same.

According to the report, Apple is expected to meet with several government departments on January 25, including electronic and commerce. It is also asking for a waiver on custom duties for new and used equipment brought to India.

Apple itself does not manufacture its iPhones and outsources it to partners such as Foxconn in China. It also partners contract manufacturers to handle the building of factories and hiring staff. In India Apple plans to partner with Taiwan's Wistron Corp rather than Hon Hai Precision Industry Co, its usual manufacturing source, said the Mint report.

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