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India’s ministerfor commerce and industry said she supportswaiving rules that threaten to blockAppleInc.’s retail stores, offering new hope for the technology company’s bid in the country.
The finance ministry “has taken a different line,”Nirmala Sitharaman,the commerce and industry minister, told reporters at a news conference Monday. “We will talk to them.”
At issue is a requirement that foreign-owned single-brand retailers buy at least 30% of their manufacturing materials from Indian vendors.
Apple in January said it had sought government permissionto open its own retail stores, which would help the company fight the stiff competition from low-cost rivals in the country. India is set toovertake the U.S.as the world’s second-largest smartphone marketafterChina.
In April, a government panel recommended waiving the local-sourcing rule for Apple, but the Foreign Investment Promotion Board—a panel that gives the final go-ahead to foreign-investment proposals—disagreed, as didFinance MinisterArun Jaitley,two government officials told The Wall Street Journallast week. It is unclear who has the final say.
When asked, Ms. Sitharaman said, “It’s the government. We are all part of it.”
An Apple spokeswoman declined to comment.
Ms. Sitharaman said her ministry, however, opposes Apple's application to sell refurbished phones in India, whether imported or refurbished locally. That proposal is currently being considered by the Environment Ministry in consultation with the prime minister’s Office.
The apparent disagreement within the government could reflect a desire for more clarity from Apple about how much it intends to invest in India, saidTarun Pathak,a Delhi-based analyst at technology research firm Counterpoint.
Apple Chief ExecutiveTim Cookvisited India in May on a charm offensive,meeting with Prime MinisterNarendra Modito discuss his company’s manufacturing and retailing plans,watching a cricket match and posing for photographs with Bollywood stars.
During the visit, Apple announced plans to open two new offices in India to foster the development of mobile apps and mapping services in the country. India, in pursuit of long-term growth, wants to leverage Apple’s interest to attract investment and create manufacturing facilities and jobs.
“At the higher levels, they are more concerned about what Apple is doing in India,” Mr. Pathak said.
(THE WALL STREET JOURNAL)
