India to lure tech companies like Apple with $550 million incentive

According to Bloomberg, India plans to increase economic incentives for manufacturers of tablets and laptops in the country to attract companies such as Apple and Dell Technologies.

A person familiar with the matter said that the Federal Ministry of Science and Technology of India had submitted the revised plan to senior executives in the electronics industry for comments, including subsidies of up to 45 billion rupees (about 549 million US dollars) for each company. To obtain these funds, foreign companies need to invest 7 billion rupees in India within five years. The incentive scale will depend on the procurement of local parts, which may be equivalent to about 6% of the sales of finished products.

People familiar with the matter said the move was intended to allow companies such as Apple, Dell, HP and ASUS to expand or start local production. In particular, India wants to persuade Apple to produce iPads locally. Apple has assembled iPhones in India through Chinese Taiwan suppliers.

The plan may change after consultation with the industry. Last year, India launched a plan worth 73.5 billion rupees, aimed at improving the local manufacturing industry and expanding the export of IT products such as laptops, tablets and personal computers. However, the plan failed to attract enterprises because the scale of stimulus measures is considered small.

It is reported that Dell, HP and other companies have already produced laptops on a small scale in India, and there is a problem of overcapacity. They may find it unattractive to increase investment to increase output.

Canalys report shows that in the second quarter of 2022, the growth of Indian PC shipments (desktops, laptops and tablets) slowed to 12%, reaching 4.6 million units. This is the first time since the last four quarters that the market's shipments have fallen below 5 million units.