Apple opens first Indian online store as Jio goes mass market

Apple opened its first online store in India this week after the government relaxed restrictions requiring foreign companies to source at least 30% of their components locally. India is the second-largest mobile phone market in the world after China, and the authorities’ change of heart has been directly influenced by a desire to capitalise on the fall-out from the escalating trade war between Washington and Beijing. Relations between India and China have also deteriorated in recent months with a stand-off on their mutual Himalayan border descending into a scuffle.
Apple’s cause has been further helped the Modi government’s production-linked incentive scheme (PLI). Part of its National Policy on Electronics, the scheme offers  incentives of between 4% and 6% to mobile and smartphone operators who use domestic handset and component manufacturers. Several of Apple’s suppliers including Foxconn, Wistron and Pegatron are among 22 companies that have applied to join the scheme, according to technology minister Ravi Shankar.
mobile phone users indiaAlmost 40% of Apple sales in India are realised through partnerships with Amazon and Walmart-owned Flipkart, but, while its market share is only between 1% and 2%, the brand is seen as immensely aspirational. The new store should help more Indians turn that aspiration into a reality, although its opening coincided with the news that India’s biggest telecom carrier Reliance Jio is all set to launch one of the world’s cheapest Android smartphones for its home market. While this development comes just months after Google invested $4.5bn in Jio, the Reliance subsidiary is said to have been secretly working on a prototype for the past two years. Jio has also reportedly asked local component suppliers to ramp up production so it can make up to 200 million phones in the next two years. India’s population of mobile phone internet users is currently forecast to increase frrom 420.7 million at the end of last year to 469.3 million by the end of 2021. The technology minister must be pleased on both counts.