India’s decision to defer manufacturing tariffs could help Apple

By

Foxconn moving additional iPhone production to India as coronavirus disrupts work
Designed in California. Made in India.
Photo: Ste Smith/Cult of Mac

More and more Apple suppliers are considering building devices in India, and a new concession might make that possibility even more plausible.

According to a new report, India has deferred a plan which would have introduced tax on touch panel imports. These tariffs were supposed to be introduced in February, but have supposedly been delayed until at least April 2020. This follows lobbying from smartphone makers.

The idea behind the new tariffs was that they would boost local manufacturing by getting companies to build touch panels in India, rather than importing them. However, while removing this hurdle won’t help Indian touch panel makers, it will make the country a more attractive short-term proposition for manufacturers.

Samsung had already written to the federal government saying that the tariff would cause it not to manufacturer two of its high-end smartphones in India. The request to reconsider import duties was also backed up by the India Cellular and Electronics Association (ICEA), which includes Apple and suppliers such as Wistron and Foxconn as members.

The delay has yet to be officially confirmed, but Reuters claims that this is imminent.

Apple’s focus on India

A number of iPhones are already produced in India. This started in 2017 when Wistron started manufacturing iPhone SE models at a factory in Bangalore in 2017. When this went well, it expanded its Indian production line to also include the iPhone 6s. It is now supposedly ramping up its investment yet further. Foxconn has also considered production in India and Vietnam, as has Apple supplier Pegatron.

The push to embrace India as a manufacturing market for smartphones comes at a time when the U.S. vs. China trade war threatens to impact the bottom line of smartphone companies, including Apple. Apple has also been working to increase its market penetration in India.

Source: Reuters