Apple’s decision to establish Apple Operations India is a strategic expansion. Its first R&D subsidiary in the country will focus on research, design, testing and supporting local manufacturing. Apple has largely concentrated its R&D efforts in the U.S., China, Germany and Israel. The move reveals Apple’s growing commitment to India as a market and also as important part of its global supply as well as innovation chain.
The timing is important as the announcement coincides with its need to reduce dependence on China amid ongoing U.S.-China trade tensions. India has a favorable regulatory space and is coupled with the government’s Production-Linked Incentives (PLIs) that provides a compelling case for Apple’s entry into R&D and manufacturing support. Setting up Apple Operations India is an astute response to such dynamics.
Apple Operations India will handle procurement, lease facilities, hire engineers for hardware development and provide critical failure analysis for group companies. Apple has even issued a “letter of comfort” to assure financial and operational support for the subsidiary. It indicates that the company views this as a sustained and strategic investment. The move may finally allow India to take part in Apple’s hardware design and testing. It is to further integrate India into Apple’s innovation pipeline.
Apple Operations India is currently equipped with capital work-in-progress worth INR 38.2 crore and fixed assets of INR 36.8 crore. Industry observers such as AltInfo founder Mohit Yadav believe that it is Apple’s signal to its intent to make India an integral part of its ecosystem beyond sales and assembly. The significance of such move becomes further clear if considered Apple’s partnerships with Foxconn, Pegatron and Tata-owned Wistron that enabled to scale production locally.
