Apple will be ready to start assembling high-end iPhones in the city in less than a month to boost its chances of gaining a foothold in the fast growing Indian market, Karnataka IT Minister Priyank Kharge said on Thursday.

 

"In less than a month, we will have something out - Apple will start assembling and making its high-end iPhones at its plant in the city. Taiwanese contract manufacturer Wistron Corp will help Apple in doing so," he told PTI in Bengaluru.

 

Kharge said making iPhones in India would help Apple lower prices, which will help it gain a foothold in the fast growing Indian market. "Assembling and making of iPhones in Bengaluru will boost Apple's chances of gaining a foothold in the fast growing Indian market because it will allow the company to lower prices," he said. Karnataka government has been in talks with the Centre for strengthening the ecosystem even as Apple is negotiating with it for its next level of production in India, he said.

 

However, in a recent report, The Department of Revenue had said no to the tax incentive demand of US-based iPhone maker. In January, Apple executives had met government officials wto put forth their key demands including Countervailing duties (CVD) exemption. Apple is looking for the government's assurance on the CVD exemption to continue for the next 15 years. It fears that in the future to push domestic manufacturing, it may impose countervailing duties. 

 

In a communication to the government, the Cupertino-based technology major has asked for incentives from the Department of Revenue and Department of Electronics and Information Technology (DeITy). Besides exemption from the Customs duty on imports of components and equipment for 15 years, Apple wants relaxation in the mandated 30 percent local sourcing of components.

 

Apple executives had made a detailed presentation to an inter-ministerial group headed by Department of Industrial Policy and Promotion Secretary Ramesh Abhishek on its road map for setting up a manufacturing unit in India

 

Apple wants to bring its component manufacturers to India to make parts and export finished phones and is seeking tax concessions on import of key components. However the Indian government has rejected most of the demands of the US company.


Kharge said if the Centre was keen on taking on China, it should not give special treatment to Apple alone, but to other players, including Samsung and Lenovo, if they are desirous of opening a manufacturing units in India, especially Karnataka.

 

"My position with the central government has been don't give special treatment to Apple alone, but treat other players equally. Open the entire ecosystem for high-end manufacturing of electronics if you really want to compete with China and Taiwan," he said.

 

Kharge said government should also give companies, including Apple, certain timelines, subsidies and incentives to create a level-playing field for them. "The government should give companies a timeline, say in 10 years they should be able to manufacture 100 percent of phones and its components by procuring them from the local market. Such a timeline should be given because we don't have that environment now," he said.

 

"The government should also give companies subsidies and incentives to create a level-playing field for them to strengthen the Indian ecosystem," Kharge said. Asked about the Stayzilla case, whose co-founder Yogendra Vasupal was arrested for alleged non-payment of dues filed by a Chennai based advertisement agency, Kharge said it should be a learning curve for startups to work under the parameters of the Indian legal system.

 

Vasupal was arrested on March 15.

 

With input from PTI