India raises import tax on electronic products, move to hurt Apple’s iPhones

India has increased the import tax on dozens of electronic products. (Reuters)
Updated 15 December 2017
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India raises import tax on electronic products, move to hurt Apple’s iPhones

NEW DELHI: India has increased the import tax on dozens of electronic products such as mobile phones and television sets, a government statement said, to help curb supplies from overseas and build up the domestic industry.
The rise in tax from 10 percent to 15 percent on handsets will make imports of phones — including most of Apple’s iPhone models — more expensive at a time the company’s revenue growth is slowing in India’s $10 billion (SR37.5 billion) smartphone market.
Prime Minister Narendra Modi has launched a flagship Make-in-India program to expand the domestic industrial base, and one of the areas showing success is electronics.
Pankaj Mohindroo, president of the Indian Cellular Association, said on Friday the tax hike will boost domestic manufacturers who are making about 500 million cellphones a year, more than double the output three years ago.
Eight out of 10 phones sold in 2017 have been made locally, data from Counterpoint Research showed.
Samsung Electronics assembles in India most of the handsets it sells in the country.
Apple currently only assembles its iPhone SE models in India and imports its others. The company has sought a range of incentives and tax relief from the government for it to expand its manufacturing in India, but government officials have said they are unlikely to make exemptions for Apple.
Tarun Pathak, an associate director at Counterpoint Research, said the government’s new tax notification, announced late on Thursday, will impact mobile phones companies heavily dependent on imports.
“It will impact Apple the most as the company imports 88 percent of its devices into India,” he said. “Either this will lead to increase in iPhone prices or force Apple to start assembling more in India.”
Aside from cellphones, the government also raised the import tax on video cameras to 15 percent from 10 percent and doubled the one on television sets 20 percent, its statement said.
On Monday, a delegation of Indian telecoms equipment manufacturers met Finance Minister Arun Jaitley, seeking government help to promote the domestic industry while he prepares the budget for 2018/19.
India’s goods imports in the seven months ending October rose 22 percent to $256.4 billion from a year earlier, raising concerns among policymakers.


Foreign investment in Saudi Arabia more than doubled in 2018

Updated 45 min 36 sec ago
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Foreign investment in Saudi Arabia more than doubled in 2018

  • Five sectors of the economy are prepared for privatisation in the first quarter of 2019
  • Ministers attend forum a day after the 2019 budget was announced

RIYADH: Foreign investment in Saudi Arabia more than doubled in 2018 to SR 13 billion ($3.5 billion), the economy and planning minister said on Wednesday.

Mohammed Al-Tuwaijri said foreign investment in 2018 rose 110 percent from the previous year.

He was speaking a day after the 2019 budget was announced, in which spending will increase by 7 percent to boost growth.

The government has made attracting greater foreign investment a cornerstone of its Vision 2030 plan to diversify the economy away from a reliance on crude revenues.

Five sectors of the economy are prepared for privatisation in the first quarter of 2019, Tuwaijri said.

He also said unemployment is expected to decline starting in 2019 from the current level of 12.9 percent.

Finance Minister Mohammed Al-Jadaan said at the same conference that Saudi Arabia has no intention of changing its policy on expatriate worker fees.

The levies are due to rise next year as part of a policy to encourage hiring of local citizens.