Apple yet to pass on Make in India benefit to customers

Even as Apple started producing its iconic smartphones in Bengaluru a few months ago, the customers are still paying higher price for their favourite iPhone models.

Despite making its phones under the Make in India initiative, the company has not passed on any price benefits to its customers. Its iPhone SE is still sold at high price on ecommerce store Amazon and retail stores.

India imposes Basic Customs Duty (BCD) of 10% on mobile handsets and parts imported and those who are manufacturing in India are exempted from it under the Central government’s Phased Manufacturing Programme (PMP) to promote indigenous manufacturing of cellular mobile handsets and its sub- assemblies.

“In the case of Apple, the company started manufacturing 'Designed by Apple in California and Assembled in India Model A1723 ' iPhone SE at its Bengaluru assembly plant from April onwards. In select stores in Bengaluru iPhone SE is priced at Rs 26,200 for a 32GB and Rs 37,200 for a 128 GB phone. Here the benefit of GST is also not given,” an analyst told DH.

When contacted, Amazon sources said the company is not selling the product at a lower price. “During the Great Indian Sale the iPhone SE 32 GB was sold for Rs 19,999 for by vendor called E-mobiles. Here we can’t say whether it is manufactured in India or China,” Amazon sources said.

When asked about the difference in the pricing, Apple sources said the company is sourcing SE phones mainly from China. “We have started procuring from Indian assembling facility and majority of the phones are imported from China. We have to pay import duty for the China product and currently there is no option of giving different pricing for the same product,” said a source close with the company.

According to Telecom Minister Manoj Sinha, India’s domestic production of cellular mobile handsets witnessed a growth of 185% in value terms in 2015-16 compared to 2014-15 and 67% in 2016-17 as against 2015-16.

"During 2014-15, mobile handsets worth Rs 18,900 crore were produced in India, which increased to Rs 54,000 crore in 2015-16 and further to Rs 90,000 crore in 2016-17. Import of mobile handsets declined from 210 million devices (worth $7,948 million) in 2014-15 to 146 million units ($6,059 million) in 2015-16. Imports further fell to 76 million units ($3,788 million) in 2016-17,” Sinha stated recently.

Domestic production of cellular mobile handsets witnessed a growth of 185% in value terms in 2015-16 compared to 2014-15 and 67% in 2016-17 as against 2015-16, he said.