Xiaomi seeks exception from local sourcing guidelines for single-brand retailing in India

10 April 2016 (Last Updated April 10th, 2016 18:30)

Xiaomi has sought exemption from the Indian Government's 30% local sourcing standards to open its retail outlets in the country.

Xiaomi has sought exemption from the Indian Government's 30% local sourcing standards to open its retail outlets in the country.

The company sources were quoted by NDTV as saying: "The company has sought permission from the Department of Industrial Policy and Promotion (DIPP) for opening single brand retail trading (SBRT) in India. They also want exemption from the mandatory local sourcing norms."

"We have filed an application for SBRT but would be unable to share more details as it is still at a nascent stage."

"We have filed an application for SBRT but would be unable to share more details as it is still at a nascent stage."

Last year, the Indian Government had relaxed standards for foreign direct investment (FDI) policy for single-brand retailing.

According to the FDI policy, the government could do away with the sourcing norms for companies dealing in single-brand retailing of products that feature 'cutting-edge' technology, which therefore makes local sourcing not feasible.

Though 100% FDI is permitted according to the guidelines, the entities have to get FIPB permission if the limit exceeds 49%.

For proposals exceeding 51% FDI, sourcing of 30% of the value of goods bought has to be from India, especially from mid-scale and small-scale enterprises.

The Chinese smartphone manufacturer currently sells its goods through e-commerce platforms and selected retail outlets.

India is one of the biggest markets for Xiaomi.