India Implements New Policy Requiring Licenses for Mac and iPad Imports
In a move that aims to boost local manufacturing, the Indian government has announced a new policy requiring licenses for imports of Macs and iPads, effective immediately. The policy falls under the country’s Made in India initiative, which incentivizes global brands to set up local manufacturing plants.
The strategy behind the Made in India program is a carrot-and-stick approach. India imposes import tariffs on consumer electronics products but allows the import of components without custom duties. One of the key bargaining chips used with Apple was the refusal to grant permission for the company to open retail stores in India until it began manufacturing a certain proportion of iPhones within the country. This led to the recent opening of the first Indian Apple Stores.
While Apple initially limited its Indian iPhone assembly to the iPhone SE in 2017, it gradually ramped up production to include the full range of iPhones. Reports suggest that a quarter of all iPhones could be made in India by 2025, and India may account for 50% of global iPhone production by 2027.
Tapping into the success of its iPhone assembly in India, Apple also negotiated a deal for local iPad production lines. The Indian government granted tax incentives for local assembly of tablets and computers in 2021. However, now the government is introducing controls to limit imports of foreign-manufactured iPads and Macs. Importing these products now requires a license, which affects five categories of computing products, including the iPad, MacBook Air and MacBook Pro, iMac, Mac mini, Mac Studio, and Mac Pro.
Apple is expected to be granted a license and comply with the new policy. However, the message from the Indian government is clear: they have the power to restrict imports and encourage local manufacturing. The five categories affected by the policy closely align with Apple’s Mac lineup.
While this latest move may appear coercive, Apple is unlikely to be too concerned. The company had already planned to manufacture iPads in India, and shifting some Mac production there will help reduce its reliance on China as a manufacturing hub. Additionally, as more Apple products are assembled in India, the incentives for establishing a local supply chain for components increase, making it easier to boost production volumes. In the long term, this benefits both Apple and the Indian economy, as India can become another manufacturing powerhouse akin to China.
Overall, the Indian government’s new policy reflects its commitment to the Made in India initiative and is likely to encourage more global brands to establish local manufacturing facilities within the country.