Apple may not be exempt from strict rules to open retail stores in India after all. An unnamed government official told Reuters Wednesday (May 25) that the iPhone maker must adhere to regulations that require foreign retailers to sell at least 30 percent locally sourced products in its stores, should it wish to move forward with plans to open retail locations in the country.
Reports pointed to slowing retail sales for Apple in the U.S. and China as possible factors behind the firm’s push into the Indian retail segment.
While recent legislative changes in India allowed high-tech companies to be exempt from this 30 percent rule, an unnamed source said Apple will not fall under this exception.
“They did ask for a waiver but didn’t provide any material on record to justify it,” the official said. “The decision was taken only after a thorough examination of their application.”
A spokesperson for Apple declined to comment on the matter.
Apple’s products are made and assembled mostly in China, according to reports.
Apple CEO Tim Cook recently spent four days in India, a venture that saw Cook meet with India Prime Minister Narendra Modi over the weekend. Reports said the trip was intended to begin Apple’s retail entrance in India; sources told reporters that the technology conglomerate is hoping to have at least three stores in the country open by 2017.
Separate sources also told reporters that Apple had attempted to convince Indian government officials to relax their 30 percent rule following the firm’s application to open retail stores in India in January of this year.
Earlier this month, reports said the Department of Industrial Policy and Promotion in India was likely to recommend to the Finance Ministry that Apple be exempt from the 30 percent rule, arguing that Apple retail stores would meet the parameter of possessing state-of-the-art and cutting-edge technology that could not be sourced locally.