India may soon play a role in the development of Apple’s new products, including research, design and testing. The Cupertino-based company has incorporated a wholly owned subsidiary in India, named Apple Operations India. A regulatory filing by the new entity listed procurement of engineering equipment, leasing of facilities, employing engineers for hardware development and providing failure analysis services to group companies, among its proposed activities. Apple Inc has given ‘a letter of comfort,’ assuring it will provide “operational and financial support” till the “foreseeable future,” Apple Operations India said in the filing with the Registrar of Companies (RoC) last week. Apple did not respond to an email seeking comment. If the iPhone maker undertakes hardware design and testing in the country, it will be a first for India. The company currently does R&D in the US, China, Germany and Israel. This is also the first time the Macintosh PC maker is setting up a direct subsidiary of the US parent in India.The holding company of its existing sales and marketing entity, Apple India, is part of the European operations — Ireland-based Apple Operations International owns Apple India, according to the RoC. Manufacturing of Apple products in India is outsourced and the new subsidiary will support third-party manufacturers and contractors by providing hardware, software and other services, said the filing. Apple Operations India is laying significant groundwork in India with capital work-in-progress worth Rs 38.2 crore and fixed assets of Rs 36.8 crore, according to the RoC filing, said Mohit Yadav, analyst and founder of business intelligence firm AltInfo. “While the subsidiary is currently in its investment phase, its charter focusing on manufacturing support, procurement management, and R&D capabilities signals Apple's strategic commitment to deepen its operational presence in India beyond just assembly and sales,” he added. EXPANDING R&D OPS At present, top global electronic brands such as Samsung, LG and Sony have research and development (R&D) operations in India, but these are mostly limited to hardware localisation of products and software development for global launches. Chinese phone manufacturers such as Oppo and Vivo have similar operations. Many American and European multinationals have set up global capability centres (GCCs) in India to insource tech and back office services, and conduct R&D. Apple is also setting up the new India entity amid the ongoing economic conflict between the United States and China, which is expected to worsen with Donald Trump winning the presidential election. Tarun Pathak, director of research at market tracker Counterpoint Research, however, said Apple setting up a R&D unit in India is to take advantage of India's technological skills rather than due to the US-China relations. “Apple has a strong app developer base in India, with over 17,000 developers and a developer centre in Bengaluru. The Apple R&D company is a testament to how India is an important market for it,” he said. RECORD SALES Apple Operations India’s memorandum of association filed with the RoC states it will engage in the business of procuring, developing, manufacturing, supporting and other related operations, such as “undertaking research and development and design relating to science, engineering, technology and applied technology, computer and information technology programming, research and systems, related technical support, technical testing and analysis.” It will also engage in providing all types of “equipment, instruments, components and systems, technical, electronic, mechanical, software or otherwise, by way of lease, hire, or otherwise, to thirdparty manufacturers and/or contractors,” the memorandum said. Apple has been setting a new sales record every quarter in India, as acknowledged by chief executive Tim Cook in all the company’s earnings calls for the past several years. Apple currently operates two companyowned stores in India and plans to soon open four more, as Cook said last month. The company undertakes development of maps for its products in India at Hyderabad. Apple has also expanded its manufacturing operations in the country through three partners, whereby it is now the country’s largest electronics exporter. PRODUCTION BOOST According to the recent Economic Survey, India contributes around 14% to the US tech giant’s overall production. Apple started assembling iPhones in India in 2017 through Wistron. The company accelerated local production after the Covid-19 pandemic. The government launched a production-linked incentive scheme, with Foxconn, Tata Electronics (which acquired the Wistron plant) and Pegatron undertaking the contract manufacturing.
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