India Announces Radical Changes to its FDI Policy, Apple Stores May Finally Get a Green Light Now

The Government of India today announced some “radical” set of changes to its Foreign Direct Investment (FDI) Policy across various sectors, including a major change to Single Brand Retail Trading.

The Government of India and Apple have been in some sort of a game of See-saw, with the possibility of company-run Apple Stores in the country hanging in the balance. The Cupertino based company has been keen on opening its stores in the country and over the last several months, they’ve almost been stuck in a system of ‘one step forward, two steps back’, thanks to India’s policies. Apple was last reported as saying that there would be no Apple Stores possible unless the 30% local sourcing norms went away.

Thankfully, India seems to have somewhat loosened its policies. As part of its announcement today, it has included the following change for Single Brand Retail Trading:

It has now been decided to relax local sourcing norms up to three years and a relaxed sourcing regime for another five years for entities undertaking Single Brand Retail Trading of products having ‘state-of-art’ and ‘cutting edge’ technology.

The ball seems to be in Apple’s court yet again.

Indian Govt. Won’t be Relaxing Local Sourcing Norms for Apple Stores in India

It looks like we’re back to square one with Apple and our hopes of seeing Apple Stores in India.

Just over six months after the Government of India announced FDI reforms and the possibility emerged for seeing Apple Stores in the country, the Govt. has now taken a sort of a U-turn about the whole thing.

ETtech’s Ruchika Chitravanshi & Deepshikha Sikarwar report that the government panel has decided not to relax the 30% local sourcing norms.

The US company’s proposal to set up Apple Stores under the single brand policy has been approved without any relaxation in the sourcing conditions, two officials privy to the development said. Apple can set up single-brand retail stores in India but it will have to meet the 30% local content sourcing requirement, they said.

“Apple’s proposal is acceptable to us but we cannot make an exception for it and forego the sourcing requirement if it wants to set up its own stores here,” a senior government official said.

sigh

Tim Cook just wrapped up almost a week-long visit to India, where he spent time in Mumbai & Hyderabad, and also met the Prime Minister of India Narendra Modi and discussed plans to sell refurbished iPhones as well as the possibility to manufacture phones in the country, as part of Modi’s ‘Make in India‘ initiative.

However, looking at today’s development, it seems like Apple’s got a rocky road ahead.

Apple Unveils New Apple Store at San Francisco’s Union Square

Apple has unveiled a new design and aesthetics for its Apple Store at San Francisco’s Union Square location, along with a shot of new services and features that the company will be rolling out to other retail locations worldwide in the coming months. This unveiling comes 15 years after Steve Jobs introduced Apple’s first two retail stores.

The Union Square Apple Store features a 42-foot-tall sliding glass doors and will be powered by 100% renewable energy. Speaking about the new store, Angela Ahrendts, Apple’s senior vice president of Retail and Online Stores, said:

We are not just evolving our store design, but its purpose and greater role in the community as we educate and entertain visitors and serve our network of local entrepreneurs.

Apple has also introduced the following new features at this store location:

The Avenue,” inspired by the window displays along a boulevard that dynamically change with the season. Avenue walls are interactive themed “windows” where Apple’s products and services come to life, from music, to creativity, apps, photography and more. New “Creative Pros,” Apple experts in creative arts, offer advice and expertise at each of the displays. Customers will also find “Only at Apple” products on the Avenue, a curated collection of third-party accessories.

Genius Grove” invites customers to get support working side-by-side with Geniuses under the comfortable canopy of local trees in the heart of the store.

The Forum” is a vibrant gathering place, centered around a 6K Video Wall. It is home to “Today at Apple,” which brings to the community the world’s most talented artists, photographers, musicians, gamers, developers and entrepreneurs to inspire and educate our customers to go further with the things they are passionate about. Today at Apple includes year-round programs for kids, new monthly events for teachers, sessions for current and aspiring developers, Creative Sessions in partnership with local experts in creative arts, Game Night with editors from Apple’s App Store® and more. The Forum and Video Wall are a place of discovery, including events about the making of movies from iTunes®, or exclusive premieres of new music and music videos from Apple Music™.

The Plaza” will be found only at Apple’s most significant stores, including Apple Union Square. It’s open to the public 24 hours a day, features public Wi-Fi and seating, and takes Today at Apple outside, with a regular weekend series of well known local acoustic performances such as Travis Hayes and global talents like Escondido, who will then give exclusive interviews about their craft in the Forum. The Plaza at Apple Union Square features a fountain by well-known San Francisco sculptor Ruth Asawa, originally commissioned in 1969, and a new work, “Love” by local artist Laura Kimpton, commissioned by Hyatt Hotels.

The Boardroom” is an intimate space where the store’s Business Team offers hands-on advice and training to entrepreneurs, developers and other small and medium business customers.

Wired was invited to an early preview, and they put together this lovely video for it.

Apple Stores in India May Be Possible Now

Just last week, I linked to an Economic Times report that claimed that the Indian Government was planning to relax Foreign Direct Investment (FDI) rules relating to compulsory local outsourcing. In case of Apple, the rules meant that they’d have to source at least 30% of the raw material from India for their products if they planned to invest in opening Apple Stores in the country.

Today, the Indian Government has issued a press release announcing FDI reforms across fifteen sectors, including some big changes related to Single Brand Retail Trading (SBRT) and E-commerce companies.

The relaxed norms contain the following two notable points:

Presently, the FDI policy considers the date of receipt of the FDI for sourcing 30% of the value of goods. With the changes announced today, the period starting from the date of opening of the first store will instead be considered.

Secondly, and more importantly, the govt. has also considered making special exceptions. Section 8 (i) of the press note states that:

Further, it is seen that in certain high technology segments, it is not possible for retail entity to comply with the sourcing norms. To provide opportunity to such single brand entities, it has been decided that in case of ‘state-of-art’ and ‘cutting- edge technology’ sourcing norms can be relaxed subject to Government approval.

This means that for some companies (Hint: Apple), it is now possible to get an approval from the govt. without the fulfilling the sourcing requirement. Seeing company-operated Apple Stores in India doesn’t seem like a distant dream any more.