India is hiking tariffs on iPhones to 20%

Apple fans in India will soon have to pay more for their iPhones.India said Thursday it is raising customs dut...

Posted: Feb. 1, 2018 1:05 PM
Updated: Feb. 1, 2018 1:05 PM

Apple fans in India will soon have to pay more for their iPhones.

India said Thursday it is raising customs duty on imported mobile phones from 15% to 20% in a move designed to protect local manufacturing. The higher tariffs take effect on April 1.

The government will also raise tariffs on some parts and accessories used in phones and TVs, Finance Minister Arun Jaitley said while presenting the country's annual budget.

"This measure will promote creation of more jobs in the country," he added.

Related: What the iPhone X costs around the world

The move is an attempt to increase India's manufacturing base, as part of Prime Minister Narendra Modi's long-standing "Make in India" initiative.

But it represents a blow to companies such as Apple and Google, which import almost 90% of the products they sell in India.

India is the second largest smartphone market in the world after China, and Apple has spent years trying to expand its footprint in the fast-growing economy.

The company started making some low-end iPhone models at a plant in Bangalore, India, last year, but local sourcing requirements and tax regulations have thus far prevented it from opening Apple Stores in the country.

The new tariffs will not have much of an effect on the market's top players, such as Apple's arch rival Samsung and current market leader Xiaomi. Both companies, which together accounted for nearly half of the 132 million smartphones sold in India last year, already make most of their devices in the country.

Related: India is poised for a smartphone revolution

Around 75% of all cellphones sold in India last year were assembled in the country, said Tarun Pathak, an analyst at Counterpoint Research.

"It is the rest of the 25% who will be impacted," he added.

The latest iPhones and Google Pixel 2s are too expensive for most Indians, many of whom earn less than $2,000 a year. The new duties will make them even more expensive, Pathak said, as suppliers hike prices to make up for the higher import cost.

Article Comments

Mason City
Clear
75° wxIcon
Hi: 83° Lo: 60°
Feels Like: 75°
Albert Lea
Scattered Clouds
73° wxIcon
Hi: 82° Lo: 60°
Feels Like: 73°
Austin
Scattered Clouds
73° wxIcon
Hi: 83° Lo: 59°
Feels Like: 73°
Charles City
Clear
73° wxIcon
Hi: 81° Lo: 60°
Feels Like: 73°
Rochester
Scattered Clouds
75° wxIcon
Hi: 83° Lo: 59°
Feels Like: 75°
Patchy fog will take time to clear alongside some cloud cover, but sunshine will be around for the afternoon and evening!
KIMT Radar
KIMT Eye in the sky

Latest Video

Image

King weighs in on primaries

Image

Rep. Steve King comes to KIMT

Image

forecast 6:30am 8.17.2018

Image

Farmer's market highlighting latino community

Image

RPS study session talks disparities

Image

'Cop on a rooftop' raising funds for Special Olympics Minnesota

Image

Turbine concerns

Image

Donut Shop Reopens After Break-In

Image

Mohawks Eager to Start Season

Image

School Supplies Giveaway

Community Events