Indian Government Approves 100% Foreign Direct Investment for Single-Brand Retail; Signaling a Major Win for Apple

The Union Cabinet today approved changes to the FDI norms for India. The government has eased norms across various key sectors at a meeting led by the PM Narendra Modi, such as construction, aviation, etc. However, the most notable and relevant change comes in the single-brand retail sector. The Indian Government has now approved 100% Foreign Direct Investment (FDI) for single-brand retail in India via the Automatic Route. Previously, it was possible to invest up to 49 percent via the automatic route — anything higher than 49 percent required a government approval.

The amendments announced today are “intended to liberalize and simplify the FDI policy so as to provide ease of doing business in the country”, said a release by the Press Information Bureau.

This change is a major win for Apple, who has been trying to setup their own stores in India for a while now. The company did get a step closer in their attempts in April of 2016, but the Indian government wasn’t ready to relax the local sourcing norms for Apple. However, in June that year, the government announced some radical changes to the FDI policy that raised our hopes yet again. Today’s announcements have hopefully brought Apple India a little closer to their goal.

The government has also decided to permit entities to “set off” the 30% local sourcing norms for the first five years, beginning 1st April of the year of opening the first store.

I have been waiting for a really long time to see company-run Apple Stores in India, not for the sales experience, but rather to experience Apple’s incredible support first-hand. It sure seems that the dream is closer to being a reality now.

If you’ve been waiting for Apple to open their own stores in India, your wait might have just gotten shorter, according to The Times of India:

On Tuesday, the iPhone and iPad maker made a presentation before a committee headed by industrial policy and promotion secretary Ramesh Abhishek where it made a case for use of the special provision. Sources told TOI that Apple was a fit case for relaxing the norms. “Their products certainly meet the requirement for waiving the local sourcing clause,” said a source, adding that a final decision will be announced in a few days.

There have been reports that the Indian government was considering relaxing Foreign Direct Investment (FDI) since November last year, which were quickly followed by the government’s official announcement later that week. Following that, Apple had submitted their request for approval in January this year, but had to re-submit because “certain gaps [were] found in the initial proposal”.

After Tuesday’s presentation, I don’t think an announcement is all that far away.