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Apple has hiked the prices on most of its iPhone models being sold in India after the government raised import taxes on foreign-made phones, according to a new report.
Prices for imported Apple devices have, on average, risen about 3.5 percent, Reuters reported. That means that a 256-gigabyte iPhone 8 is 79,420 rupees, about $1,237 in U.S. dollars. On the high end of the spectrum, a 256 GB iPhone X will now run Indian consumers 105,720 rupees, about $1,647.
For comparison’s sake, $1,650 would be roughly enough to buy both a 64GB iPhone 8 and a 64GB iPhone X in the U.S., before taxes.
The only exception among Apple’s lineup is the locally produced version of the iPhone SE. Earlier this year, Apple tapped its Taiwanese supply chain partner Wistron to assemble iPhone SE devices in Bengaluru, India. Currently, the iPhone SE sells for between 20,000 and 24,000 rupees on various online retail outlets — which roughly translates to about $310 to $380.
But even the locally produced iPhone SE is beyond the budgets of many Indian consumers. As Reuters points out, Apple is seen as an “aspirational brand” that’s beyond the reach of many. That becomes especially apparent when an iPhone X costs about 20 to 30 percent of an individual’s average annual income in the country, according to 2016 World Bank data.
Because of that, Apple holds just less than three percent of the smartphone market share in the country. In an effort to gain ground, it’s even kept older and outdated iPhone models for sale in India.
India is becoming increasingly important for device makers, as the country has recently surpassed the United States as the world’s second-largest smartphone market after China. While basic and feature-limited phones still make up a majority chunk of the 750 mobile devices in India, sales of smartphones are steadily growing faster, according to Reuters.
But last week, the Indian government raised import taxes on smartphones from 10 to 15 percent in hopes of spurring local manufacturing. For companies like Samsung, which already locally assembles most of the devices sold in the country, that doesn’t make much of a difference. But it has a bigger impact on Apple’s products since around 88 percent of iPhones are imported into the country.
Apple’s local manufacturing ambitions don’t just stop at the iPhone SE — Cupertino has long wanted to create a “manufacturing ecosystem” in the area. But it’s also sought a range of tax breaks and financial incentives to do so. Handouts that the Indian government has, thus far, seemed hesitant to agree to.
Of course, some analysts question whether the increase in import taxes will really have that profound of an effect on Apple’s market share in India. “Apple’s halo as a premium brand in India cannot be taken away by this meager price rise,” said Navkendar Singh of research firm IDC.