On Jan. 19, 2023, Prime Minister Narendra Modi will launch a slew infrastructure projects at the MMRDA Grounds in Bandra-Kurla Complex (East), Bandra, India.
Hindustan Times Getty Images
Apple is planning a busy week in India where it has high ambitions.
Tim Cook, the CEO of Apple's India division, will meet Indian Prime Minister Narendra Modi in New Delhi on Wednesday. Modi wants to know about Apple's plans for expansion across India and the number of jobs that the company will be creating, according to sources with knowledge of this matter.
Modi wants to know what challenges Cook faces in growing the production of the company across different states. The people who requested anonymity because they were not authorized to speak on the subject publicly said.
Nelson Cunningham is the co-founder and CEO of McLarty Associates, a diplomatic solutions company. Cunningham, a recent returnee from India, said that the state level is where businesses are facing the biggest obstacles.
Apple's spokesperson refused to comment on a meeting between Modi and the company.
Apple is expanding iPhone production in India via its suppliers. JPMorgan predicts Apple will shift 25 percent of iPhone production to India in 2025.
Modi and Indian officials are widely praised for Apple's success in India. Sources said that in November, a delegation of state ministers was sent to the U.S. for meetings with major companies located in New York City and Silicon Valley. Their pitch? Apple is not the only company that can manufacture and sell products in India.
CNBC was invited to a meeting of the Council on Foreign Relations, where a senior Indian official stated that Apple's success is a great case study for any company considering investing in India.
Apple's problems in India are evident. Google's Android smartphones dominate India's smartphone industry, and they are usually cheaper than iPhones. Google's dominance is so strong that it was fined $160 million for antitrust violations in India in March.
Apple's future is viewed positively by Dan Ives of Wedbush Securities.
Apple's India strategy will not be built in an instant, Ives said Monday.
There are also concerns for U.S. technology companies about the Indian government's handling of data collection and a new competition policy currently being debated in India's Parliament.
Cunningham said that the future of India's data protection policy is still uncertain. The outcome will determine if foreign companies expand into India.
A lack of highly-specialized labor is another problem. India's information technology sector employs only 5 million people, despite the fact that it is expected to overtake China as the most populous country in the world.
Some of the largest U.S. companies have established footholds in India by acquiring other businesses. Walmart purchased Flipkart's control for $16 billion back in 2018. Flipkart and Amazon compete for the top spot on India's online market. They are both challenged by Meesho, a newcomer.
Disney's entry into the country followed its $71 billion acquisition of Fox Entertainment Business. Star India is India's leading sports media outlet. Media Partners Asia estimates that Disney's Hotstar service will have 49 million Indian subscribers by 2022, compared to Amazon Prime Video with 17 million, and Netflix with 7.5 million.
Pramit Chaudhuri is the head of South Asia for Eurasia Group. He said that Disney has been focusing on mainstream Bollywood content.
This report was contributed by CNBC's Steve Kovach
Watch Tim Cook visit India to open the first Apple retail store