Apple is reportedly considering producing iPhones in the southern city of Bangalore in India according to CNNMoney. The report says Apple and Indian government officials met to discuss the move even though neither side is yet to confirm the talks.
The Times of India first reported back in December 2016 that Apple was in fact considering such a move from April 2017 and that plans had been concluded to begin as scheduled. This comes as the Narendra Modi led government has been aggressively pushing its “Make in India” campaign to attract companies to invest and actually manufacture in India. It now looks as if the move is gradually yielding results if the Apple production in Bangalore eventually materialises.
Last year in a bid to increase sales of its products in a market that has over 300 million smartphone users, Appel applied to open retail stores in India in recognition of the market as one of the biggest in the world. India for example now has more Android devices than the United States and has a smartphone usage that’s near the figures in Africa as a whole and this makes it an important market for smartphone users like Samsung who have outpaced Apple there. To take advantage of the renewed interest by companies to now invest in India which has proved to be more friendly to western tech firms than China, India now says a company must source 30 percent of its raw materials locally and this is similar to the local content policy in nations lie Nigeria especially in the oil sector of the economy. This has over the years forced foreign oil firms to employ locally rather than filling most juicy positions with expatriates.
Seeing as the Indian population will likely surpass that of China by 2022, the market will then be a one of main focus for the global economy.
But Apple has reasons why it must take full advantage of the Indian economy and the obvious one is that its iPhone sales are on the decline which led to Apple reporting its first drop in quarterly growth in 13 years last year. This followed a series of forecasts in 2015 that said Apple’s main product would likely see a decline and then there was an IDC second quarter smartphone shipment report which placed Apple at a distant second to Samsung. The iPhone actually recorded a 15 percent decline year-over-year at the end of the second quarter of 2016.
Apple has some catching up to do in India where Chinese brands like Xiaomi and Lenovo already have a significant presence and then there’s Samsung too. But with an average income of $1,500, most of the 1.3 billion Indians may not be able to afford an iPhone and the same is true for the African market too which has seen a sharp rise in Android usage over the years.
Maybe Apple has a strategy but we’ll wait and see.