Apple Not Able to Open Retail Stores in India Without Selling 30% Locally Sourced Goods

[macintologist]

If a tree falls in a forest and nobody is around to hear it, is this still a bloody stupid comment?

It's a good comment because India should be taking a cue from wealthy nations that don't have these stupid rules.
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LOL, that was the funniest part of the article.

Because India and all its poverty and filth is in a position to define what is cutting edge and what isn't.

 

[niun]

It's a good comment because India should be taking a cue from wealthy nations that don't have these stupid rules.

Which wealthy nation did you have in mind?
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Because India and all its poverty and filth is in a position to define what is cutting edge and what isn't.

Wow!

 

[TurboPGT!]

but the ministry of finance has decided Apple's products do not fall into the cutting-edge technology category

if that isn't a slap in the face, I don't know what is

No, its a legal exception for when they feel exceptions should be made. And they smartly do not wish to make an exception for Apple, because it would be foolish to do so.
It is smart economics to insist Apple's stores benefit India by some measurable degree, and not just be taking up space to make profit exclusively for Apple on Chinese goods.

It is laughable how many of you amateurs interpret the article as "India doesn't think Apple's products are cutting edge, so they don't qualify".

No. The exception is not automatically granted just because the products are cutting edge. An exception to the norm can be made if the circumstances warrant it, which is exactly what applying for the waiver was about. They deemed it to NOT warrant it, for economic reasons...Apple makes disgusting profit per square foot on Chinese goods. Of course they want a piece of the action. They'd be stupid not to.

Maybe the US should start insisting that retail outlets sell a minimum of 30% US made goods. In reality we're too far gone to make that feasible, but in theory it would have all kinds of positive economic impact.

 

[macintologist]

Which wealthy nation did you have in mind?

All of them. They don't have stupid rules that prevent a foreign retail store from selling their goods if none of them are manufactured in that country. Think about Luxembourg for example, one of the richest per capita countries in the world. They don't have these stupid rules.

 

[bushido]

The EU are proposing a minimum of 20% local content.

wooops oh well close enough? thought i heard 30% before. maybe that was France?

 

[niun]

All of them. They don't have stupid rules that prevent a foreign retail store from selling their goods if none of them are manufactured in that country. Think about Luxembourg for example, one of the richest per capita countries in the world. They don't have these stupid rules.

I didn't know Luxembourg had an Apple Store.
Also, being a massive tax haven I'm not surprised they're a little lax on rules.

One more point. It would be pretty much moot for these nations to insist on 30% of locally manufactured products. Why?
Because none of them produce anything other than finance and banking!

 

[vvs14]

All of them. They don't have stupid rules that prevent a foreign retail store from selling their goods if none of them are manufactured in that country. Think about Luxembourg for example, one of the richest per capita countries in the world. They don't have these stupid rules.

Mostly wealthy nations do not have a population problem. Indian government has to think about mass job creation. Manufacturing jobs is one of the ways of doing that.

 

[Chupa Chupa]

Clearly this policy has proven to work for India as it wallows at or near the bottom 3rd tier of world's poorest countries based on GDP per capita. (Take your pick of World Bankd or IMF calculations). Protectionism always taxes an economy, especially to this extreme. It sounds fantastic just like a lot of fairytales, but like those fanciful stories, they don't mesh with reality when your trading partners are every other country in the world.

 

[macintologist]

I didn't know Luxembourg had an Apple Store.
Also, being a massive tax haven I'm not surprised they're a little lax on rules.

One more point. It would be pretty much moot for these nations to insist on 30% of locally manufactured products. Why?
Because none of them produce anything other than finance and banking!

Maybe India should do more finance and banking then! If it works so well for wealthy countries, why not India?

 

[Chupa Chupa]

Mostly wealthy nations do not have a population problem. Indian government has to think about mass job creation. Manufacturing jobs is one of the ways of doing that.

Yes, but the way to do that is to compete in the marketplace and sell companies on why India is a great place to set up shop. Make incentives that entice companies to want to come and then evangelize why its so great once set up. All the current law does is make consumer goods artificially high by setting up an arbitrary sales % number. It keeps more companies out of India than the number off jobs it creates.

 

[vvs14]

Yes, but the way to do that is to compete in the marketplace and sell companies on why India is a great place to set up shop. All the current law does is make consumer goods artificially high by setting up an arbitrary sales % number. It keeps more companies out of India than the number off jobs it creates.

Well the US has no such law... How is it working as far as keeping manufacturing jobs in the country is concerned?

 

[niun]

Maybe India should do more finance and banking then! If it works so well for wealthy countries, why not India?

Are you being deliberately obtuse?

 

[Chupa Chupa]

Well the US has no such law... How is it working as far as keeping manufacturing jobs in the country is concerned?

Manufacturing jobs are not the sine qua non of a strong economy. There is still lots of manufacturing going on in the U.S. but where it's not efficient to do so, yes, it's gone to places where it's less expensive to produce. Meanwhile, the service economy in the U.S. is as strong and growing as ever.

But again to my point, if India wants manufacturing jobs it should go out and compete for them just like other countries do, even individual U.S. states.

And yes, even with a smaller manufacturing base the U.S. remains one of the wealthiest by GDP nations on earth.

 

[SteveDJ]

In India, 30 percent of goods sold by foreign companies must be manufactured or produced in the country, a requirement Apple does not meet as its products are largely made in China.

I wonder how the ministry of finance in India would take to the US government requiring that any company doing consumer business in the US be required to use a minimum of lets say 50% US based customer/technical/administrative support agents. Or would they rather the market economy be allowed to freely drive this business to their shores?

 

[stopthenonsense]

16 GB base storage on iPhones, lack of 4K support on Apple TV, and a Mac Pro that hasn't been updated since 2013. I wouldn't call that cutting-edge either to be honest.

A country where people still live in mud huts and 4g is non-existent.... a 1st gen MBP would be cutting edge! Hate to tell you this, but I have 3 Apple TV's and not a single 4k TV in my house, so it's of no significance to not have 4k.

 

[loon3y]

India really is putting Apple under the pump. Good on India for trying to negotiate a deal that suits their country's own objectives instead of simply accepting another corporation setting up shop, using the workers only to then move on with little benefit to the country. Play hard ball, India.

LOL because apple products are not a necessity over there, its a luxury for the higher class. Average citizen cannot afford an New iPhone (Newest Model) without help from somewhere.

If they do make those stores, its going to be packed with no sales. Just people coming to windows shop or play with them.


1. They don't need Apple there

2. If Apple really wants to get their foot in the door, they need to help out the country.


So its really win, win. And India is FAR from producing ANYTHING of US standards, let alone Apple's. So I don't see this happening anytime soon, if they do its going to be a huge headache.

Western businesses had a hell of a time dealing with chinese vendors around 15-20 years ago. The situation in India is EXTREMELY worse. I have a hard time with guys with Masters in Computer science form India, lol FACTORY workers? Mangers? forget about it.

Not to mention the bribes will probably triple (in terms of how many times and different people you need to bribe not amount, amount will always be higher in China because of the strength of their currency) the times of China.


But thats definitely the correct way India should take, and they can afford it. Their citizens want iPhones but thats where it stops. If apple really wants to have capture India like how they capture China (In being infatuated with apple products and growing up with them) then they will produce in India. But honestly I think they can wait another 20 years until things get up to speed there.

They need to improve there, their lack of knowledge of how the rest of the world works is the thing thats really slowing things down, not to mention their 'true' form of democracy where they have too many political parties to really even get things done.


Why can't we just adapt Classical Athenian Democracy?

 

[Apple Corps]

If your comment wasn't at all related to my comment and this topic, which is odd because you replied to my comment, then maybe start a thread titled "Indian economic and business decisions helped their population / society / etc." and get some answers if you think "I've totally missed the point".
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I agree. Quality good paying jobs is what is needed. Manufacturing can be good paying and quality if Apple ensures it workforce are treated humanely and fairly with proper good conditions.

My comment was related to your post - it was for context - based on experience one could conclude that economic / business decisions made by the Indian government are most likely to be wrong for propelling their economy and the plight of their population.

 

[smacrumon]

LOL because apple products are not a necessity over there, its a luxury for the higher class. Average citizen cannot afford an New iPhone (Newest Model) without help from somewhere.

If they do make those stores, its going to be packed with no sales. Just people coming to windows shop or play with them.


1. They don't need Apple there

2. If Apple really wants to get their foot in the door, they need to help out the country.


So its really win, win. And India is FAR from producing ANYTHING of US standards, let alone Apple's. So I don't see this happening anytime soon, if they do its going to be a huge headache.

Western businesses had a hell of a time dealing with chinese vendors around 15-20 years ago. The situation in India is EXTREMELY worse. I have a hard time with guys with Masters in Computer science form India, lol FACTORY workers? Mangers? forget about it.

Not to mention the bribes will probably triple (in terms of how many times and different people you need to bribe not amount, amount will always be higher in China because of the strength of their currency) the times of China.


But thats definitely the correct way India should take, and they can afford it. Their citizens want iPhones but thats where it stops. If apple really wants to have capture India like how they capture China (In being infatuated with apple products and growing up with them) then they will produce in India. But honestly I think they can wait another 20 years until things get up to speed there.

They need to improve there, their lack of knowledge of how the rest of the world works is the thing thats really slowing things down, not to mention their 'true' form of democracy where they have too many political parties to really even get things done.


Why can't we just adapt Classical Athenian Democracy?

Too much to unpack in this comment and not enough time in the day to do it. However if you are speaking as an expert on China and India, it might be worth noting your credentials, a lot of the comments read like generalizations.

 

[billy the fish]

Good for them but also, isn't setting up shop and billions of dollars in revenue going to generate significant tax revenue for the country? I am not sure if driving out competition is best in the long term, but hey, not my country.

It would if they paid any corporation tax!!

 

[smacrumon]

My comment was related to your post - it was for context - based on experience one could conclude that economic / business decisions made by the Indian government are most likely to be wrong for propelling their economy and the plight of their population.

Your comment could also read "based on experience one could conclude that economic / business decisions made by the United States government are most likely to be wrong for propelling their economy and the plight of their population" and it would also have a ring of truth to it in some regards.

 

[ksnell]

Someone hasn't been paying attention to Apple's elaborate Irish tax avoidance scheme

You see, it's not just the US to whom Apple does not pay very much tax. It's most every country they've sold devices in. That's why more and more are passing laws trying to get their rightful share, and even back taxes.

Good point, but I believe that tax strategy has been shut down in Ireland and will be phased out on companies that already employed it. Surely they will find a different way. Again, that's competition.

In the end, if India will go through these lengths just to block Apple (and other foreign companies), they would surely lock down their tax code if they allowed them in.

 

[KPandian1]

All of them. They don't have stupid rules that prevent a foreign retail store from selling their goods if none of them are manufactured in that country. They don't have these stupid rules.

These "stupid" rules exist in the USA in different forms. Some are based on WTO rules that equates a product made in slave nations at less than $1-5 per day is to be treated in open trade as the ones made in nations that pay $15-60 per hour! Result - most jobs moved to China by the industrial bosses of this country; mostly the labor that required manual skill. So, gone are the textile jobs.

Other "rules" are based on monopoly of middle-men or service providers. Texas still makes sure Tesla cannot sell there - the cars are bought and registered in California and re-titled in Texas. All because the politicians are still bribed by the dealership lobbyists. The sad state of cable and broadband providers - same thing. But more of the nations customers, about 100 million customers, are affected by this than the few thousands who buy Tesla now.

The 30% rule India forces is just for Apple to open its brand store - you can buy almost all Apple products in the third-party stores in India. The prices are the same inflated ones that Apple sells its products outside the USA, ask EU and Australia. Third-party stores in the USA sell the Apple products at the same price as the ones at the Apple store.

Both GM and Ford make their cars in Canada or Mexico and assemble some of them here in the USA! Does that sound fair!?

The reasons for the "stupid" rules vary, but they exist in China, India and USA! Do you know how tough it is to sell a product made entirely outside China, in China?

The Apple store in India will provide better product service, and even in its absence, the products will still sold in the same volume.

 

[ksnell]

It would if they paid any corporation tax!!

They do, just very little

I always find it funny how no one bashes Google, Microsoft, Facebook, or any other companies for employing this strategy. If a company can save money, they will - the same way you or I do. I don't pay anymore taxes than what's legally required and don't expect them to either.

If India will go though lengths to block Apple and other companies from entering, you can be sure they would lock down the tax code if they did allow them.

 

[Gudi]

In India, 30 percent of goods sold by foreign companies must be manufactured or produced in the country.

This must severely reduce foreign retail in India. For products in urgent need of purchase advice and customer service it's a death message.

 

[neutralguy]

The truth lol

Imagine if in the U.S. every retailer had to sell 30% of Made in U.S.A. products... that would be something. I remember when the "made in the U.S.A." was like... wow!!!! take my money!!!

I like the way Indian government has made decisions against Apple and Facebook. In US, the government decisions are made by lobbyists. Nobody forced US to open up their trade. Every country has a right and responsibilities to make sure that their citizens are getting employer and earning money! Excellent job India!
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As if corruption only exists in India.

US has equal amount of corruption too.