The irony of our times....

One cannot help but wonder as to why the Govt is bending backwards to accommodate Apple? Why is it so important for us to relax our FDI rules so that Apple can come and set its single shops around India? And that too for a company whose chief shunned India till he was alive. And mind you, Apple wants to come to India today because it is losing market share in China, which is its biggest market outside USA.

It is a indeed a very piquant situation; on one hand we allow precious brain drain to happen and on the other, bend backwards to accommodate this company to sell its expensive gadgets in India. Are we missing the point here completely?

As per the FDI rules, single brand retailers which bring in more than 51% stake need to buy at least 30% of the manufacturing material from Indian vendors, mainly from small and medium scale vendors. This requirement can be waived if the retailer is bringing in a state of the art, cutting technology, which is not available in India. To ascertain this waiver, a panel in Delhi scrutinizes the proposals. This was done so for Apple and the panel recommended that this local sourcing rule could be waived off. But the Foreign Investment Promotion Board, along with the Finance Minister Arun Jaitley have disagreed. Yet, now we hear that Apple had sought to get around the sourcing rules by citing a clause that exempted retailers of “cutting edge” technology from the requirements. It could now be exempted from this 30% rule for three years and many say that it could be extended to 5 years too.

So we have relaxed rules for Apple but we only hope that it sets up a manufacturing base in India and helps generate employment. Or else we will remain just a marketing place.