Apple recently made a commitment to have a presence in India for the “next thousand years.” But the first month isn’t going well — Apple won’t be able to open retail stores straight away, and now, India has rejected its plan to sell low-cost refurbished iPhones.
During a visit to India last month, Tim Cook made it clear that breaking into the country’s phone market was going to be a crucial play for the next decade. But to do so, Apple needed some way of selling devices in a country where the average phone price is around $100.
The solution was supposed to be refurbished iPhones — Apple would take used handsets from richer markets, fix any flaws, back them with a warranty, and sell for a few hundred dollars to the Indian market.
But India’s government seems to have taken offense to being treated as a dumping ground for Apple’s last-gen technology. According to LiveMint, commerce and industry minister Nirmala Sitharaman told a press conference that “We are not in favour of any company selling used phones in the company, however certified they may be.”
“Dumping” in the context of economics and trade has a very particular — and unflattering — definition. It refers to selling a product in a foreign market for cheaper than in the domestic market, allowing a more technologically developed country and company to use its manufacturing power to drive out local competition.
If Apple were straight-up selling iPhones for cheaper, that would be a classic case of dumping. Since it would be reselling used iPhones, it claims it’s a different matter. In a previous interview, Tim Cook vehemently denied that selling used iPhones would count as dumping:
“First of all, we would never ‘dump’ anything, this in virtually all countries in the world we have a process by which a phone that’s been used by the first owner or is taken back and made to be new, if you will, and a warranty is placed on that, just like a warranty for a new phone. And it’s sold for a more affordable price and that happens in several countries. What we want to do is do the act of bringing it back to this pristine level, we want to do that in India for the Indian market. We may have to bring in some phones from other markets in order to fuel the supply chain if you will. But the act of bringing them to pristine conditions, we want to do that in this country,”
Unfortunately for Cook, the Indian government really doesn’t seem to be on his side. Apple may not be allowed to open retail stores for some months, either. India has a provision that to open a branded retail store, that store must be selling 30 percent locally-made products. Apple has applied for a waiver of that rule until it can get manufacturing up and running in India, but the most recent reports hint that the Indian government won’t be forthcoming.