Apple has opened its first retail store in India, but customer challenges remain

Image credits: Indranil Aditya/Bloomberg/Getty Images

Apple CEO Tim Cook opened the first Apple Store in India on Tuesday in a landmark milestone for the iPhone maker after nearly 25 years foraying into the South Asian market. During his trip to India, for the first time in years, Cook held meetings with high-profile business leaders, including Mukesh Ambani of Reliance and Natarajan Chandrasekaran of Tata Group, as well as Prime Minister Narendra Modi as Apple intensifies its battle against Samsung over the luxury smartphone market. In Asia. The second largest economy.

The US giant’s first official store — and a second retail location is set to open in New Delhi on Thursday — comes as Apple ramps up its manufacturing campaign in India, hoping to turn one of the world’s largest smartphone markets into a key global iPhone assembly hub.

Apple’s iPhones currently occupy less than 5% of the smartphone market in India, but their share has grown in recent years as more Indians buy premium phones. The opening of the 20,000-square-foot Apple Store in the upscale shopping mall owned by Reliance in financial capital Mumbai attracted hundreds of people queuing to see Cook open the glass doors.

The creation of Apple’s first retail stores and the company’s increased efforts to assemble iPhones and other products in India underscore the importance of the South Asian market to the Cupertino-based tech giant. According to JP Morgan analysts, Apple is expected to expand its manufacturing capacity in India to produce 25% of all iPhones by 2025.

The company’s increased production is already bearing fruit. Apple exported more than $5 billion in smartphones from India, nearly half of all exports from the country, in the fiscal year that ended in March, according to industry analysts.

“Our mission at Apple is to enrich and empower people’s lives around the world,” Cook said in a statement Monday. “India has a beautiful culture and incredible energy, and we are excited to build on our long history – supporting our customers, investing in local communities, and working together to build a better future with innovations that serve humanity.”

However, the benefits of these initiatives have not been fully realized by one primary stakeholder: Apple’s customers.

Despite local iPhone assembly and the company’s contract partners reaping the rewards of New Delhi’s generous incentives, Apple products, including the iPhone, remain very expensive in India in a move that stunned analysts who thought Apple would pass the incentives on to customers.

Take the base model iPhone 14 Pro as an example. It is priced at $999 in the US but retails for over $1,550 in India. The iPhone 14 is not an isolated example, of course. The second generation HomePod, which retails for $299 in the US, costs $400 in India, much more expensive than the first generation HomePod.

Official iPhone cases are priced similarly to some of the country’s best-selling Android smartphones. According to market intelligence firm Counterpoint, Google’s Android has 98% of the domestic smartphone market.

Many popular Apple services such as News+, Fitness+ and Apple Pay remain unavailable to Indian consumers. The Apple Card and its accompanying savings account feature in the US is also absent from the Indian market. Apple Maps and Siri offer fewer features for Indian customers. (Google Pay and Walmart’s PhonePe both lead the mobile payments market in India.)

The truth is, millions of Indian consumers continue to buy Apple products despite feeling like second-class customers. While Tim Cook’s visit to India every five years is a noteworthy event, it hasn’t brought about substantial change for Apple fans in the country.