In a boost for smartphone makers like Apple and horde of Chinese vendors to open exclusive retails stores in the country, the government on Friday announced to relax the mandatory 30 per cent local sourcing norms for FDI in the single-brand retail sector.
Tech companies have time and again reiterated that it was difficult for them to procure goods from India to meet the 30 per cent condition.
The news comes as a relief for Apple that is facing tough times in the Indian smartphone market in the wake of stiff competition coming from the Chinese players.
Industry analysts said the relaxation of local sourcing norms will provide the necessary growth stimulus for the Indian economy and will enable the country to potentially attract the likes of Apple and others.
“Over the long term, this policy thrust would ensure increased competitiveness of Indian homegrown manufacturers, as they benefit from the closer integration with global markets, as well as from the opportunities that the expanding domestic market would potentially offer,” Prabhu Ram, Head, Industry Intelligence Group (IIG), CyberMedia Research (CMR), told IANS.
The ongoing US-China trade tensions present a critical opportunity for India to seize the opportunity, take the leap, and become an integral part of the global value chain, Ram added.
“As enterprises look at relocating outside China, and setting base elsewhere, India has a clear opportunity to take the leadership mantle, attract them, and potentially emerge as a key manufacturing hub for the new world,” he noted.