iPhone has always been considered a premium smartphone in India. Every year when Apple launches its new iPhone, the first question in the mind of Indian customers is why the iPhone is so expensive in India, while the same phone is available much cheaper in America or other countries. Not only the brand value, but a whole system of taxes and duties works behind this.
First of all let’s talk about the base price of iPhone. Apple prices its iPhones in dollars. The price shown in America often does not include tax. Whereas in India, all taxes are already included in the declared price of the phone. This is the reason why there is a big difference in the prices of the two countries.
Custom duty is levied on smartphones imported into India. If an iPhone comes to India completely manufactured from abroad, then basic custom duty, social welfare surcharge and other charges are levied on it. This directly increases the cost of the phone. Although Apple has now started assembly of some iPhone models in India, still not all parts are made here.
After this comes GST (Goods and Services Tax). In India, 18 percent GST is imposed on smartphones. This tax contributes significantly to the price of the phone. That means GST is added to the price which has already increased due to custom duty.
Apart from this, logistics, retail margins and distribution costs also make the iPhone expensive. Apple keeps its products in the premium segment and the company’s retail network also works accordingly. Showroom, staff and marketing expenses are also ultimately recovered from the customer.
Another important reason is the currency exchange rate. When the rupee weakens against the dollar, imported products become more expensive. A global company like Apple also has to add the risk of these fluctuations to the price.
In recent years, the Government of India has emphasized local manufacturing to promote “Make in India”. The effect of this has been that the prices of some iPhone models have seen a slight decline compared to before. However, experts believe that unless the entire supply chain is developed in India, it is difficult for the iPhone to become cheaper.
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