US Tech Giant Apple Inc Faces Rejection from Indian Government

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Apple, the US tech firm, towards gaining market share against competitors with cheaper prices, proposed to Indian government to allow sales of “refurbished iPhones” at a discounted price. Government has in response rejected the plan to import used iPhones, according to officials. This will prove to be a disadvantage to the firm which has been seeking to revive the lagging sales of their smartphones.

India is currently promoting its ‘’Make in India’ initiative to enhance the competitiveness of its manufacturing industry, and views this move of Apple Inc as a disadvantage to the domestic phone makers. For now, the Government has rejected the proposal citing that would breach India’s anti-dumping rules. NN Kaul, from the telecom ministry has further explained that, “India does not encourage dumping or recycling of hazardous materials.” Refurbished iPhones can be described as devices that have been returned by consumers or are repaired after damage. The sale of these models is a practice common in United States and many other countries.

Facing competition from the International tech giant, the government has made these decisions in interest of the Consumer Electronics and Appliances Manufacturers Association, consisting of various domestic players in the technology field. It has been reported that the association had written to the telecom ministry to reject the proposal.

Currently, Apple Inc faces competition from local phone companies providing low cost models with similar technology. A regular smartphone, in India, is sold for less than Rs 10,000, while an Apple iPhone’s retail price is Rs 39,000 , increased due to import duties and distribution costs. This high price is reducing their customer market and slowing down their sales. Additionally, losing its trademark dispute in China will also cost the company in terms of its turnover.

Source: http://www.tehelka.com

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