India import hurdles hit Apple iPhone, Xiaomi devices from China -sources

Compal Electronics

25/11/2020 10:19

By Sankalp Phartiyal and Aditya Kalra
    NEW DELHI, Nov 25 (Reuters) - India's tight control of
quality clearances for electronic goods from China slowed the
import of Apple's  AAPL.O  new iPhone model last month and held
up other products made by companies like Xiaomi  1810.HK ,
according to two industry sources. 
    Applications to the quality control agency, the Bureau of
Indian Standards (BIS), typically used to be processed within 15
days, but some are now taking up to two months or longer. 
    BIS started delaying approvals in August for China-made
imports of devices like smartphones, smartwatches and laptops,
part of the fallout from deteriorating ties with China after a
border clash in June that left 20 Indian soldiers dead.
 urn:newsml:reuters.com:*:nL4N2FF25W 
   Since the clash India has tightened rules for investments
from China and banned hundreds of Chinese mobile apps, including
from tech giants Tencent  0700.HK , Alibaba  9988.HK  and
ByteDance. It banned 43 more apps on Tuesday.  urn:newsml:reuters.com:*:nL1N2IA0WJ 
    When Apple's new iPhone 12 was caught in the delays, Apple
India executives called on BIS to speed its approval up, giving
assurances that the company would continue to expand its
assembly operations in India, the two sources said. 
    It was not clear how long the iPhone 12 application was
delayed, and Apple did not respond to a request for comment. 
    The company has assembly operations in India, but newer
models and the iPhone 12 are imported from China, where contract
manufacturers make the bulk of Apple's devices. 
    As of Wednesday, 1,080 applications to BIS for laptops,
tablets and other devices were pending, with 669 of those
waiting more than 20 days, according to the agency's website. 
    These included applications for devices from China-based
factories of Wistron  3231.TW  and Compal Electronics  2324.TW ,
and from Hangzhou Hikvision  002415.SZ , the data showed. 
    Some of the applications for approval have been pending
since September. 
    
    CALLS FOR BOYCOTTS
    Indian traders and Hindu nationalist groups have for months
called for boycotting imported products from China because of
the border clash, while Prime Minister Narendra Modi continues
to promote self-reliance and local production.  urn:newsml:reuters.com:*:nL4N2E11XE    
    "While the BIS is delaying approvals for products like
smartwatches, the Ministry of Electronics and Information
Technology is pushing companies to make these devices in India,"
said one of the sources. 
    Under BIS's registration scheme, certain electronic goods -
whether imported or locally made - need to meet certain
standards. After companies get their products tested in a
certified laboratory, BIS approves the applications. 
    Wistron and Compal did not respond to requests for comment.
Hikvision declined to comment. 
    BIS Director General Pramod Kumar Tiwari and India's tech
ministry did not respond to requests for comment.
    The clearance delays are the latest headache for technology
companies whose supply chains were hit by the COVID-19 curbs,
pushing some smartphone makers to resort to imports of even
models made in India. The delays also come during India's
festive season when customers make big ticket purchases of
everything from mobile phones to gold and cars.  urn:newsml:reuters.com:*:nL4N2DN2UQ
    The BIS delays have also hit smartwatch imports for
companies including Xiaomi and Oppo, the two sources said. 
    Xiaomi and Oppo did not respond to requests for comment.
    In July, India's trade ministry also restricted inbound
shipments of TVs by requiring importers to get a special
licence, a move that one of the sources said continues to hurt
companies such as Xiaomi and Samsung Electronics  005930.KS .
    Xiaomi was denied the special licence to import roughly
30,000 units of TVs, while Samsung has faced similar import
hurdles, the source said.
    Samsung did not respond to a request for comment.

 (Reporting by Sankalp Phartiyal and Aditya Kalra; Additional
reporting by Aditi Shah; Editing by Euan Rocha and Tom Hogue)
 ((sankalp.phartiyal@thomsonreuters.com; +91-11-49548064;))