Why Apple Backed out from India?

rmunaval writes "BusinessWeek reports an interesting article on why Apple might have backed out from India. The prime reason being, India has grown at a much more rapid rate than expected and is no longer the cheap destination for the companies. It grew at an astonishing rate of 9.3% last quarter."

Comments

Re:Expected

[Jonboy X]

This economic phenomenon is expected and was already discussed in this fora.

Forum is the singular, as this is just one forum.

As the demand for the work increases, to get the best in the business, one has to pay more.

Is supply and demand news to anyone?

Also, the overall economic indicator increases along with it comes higher land rates + higher standard of living.

Indicators do just that, indicate. They don't cause "land rates" or the standard of living to rise; they just show that they have risen or will rise.

This makes it much more costly for the average person too, which means the average pay increases quite a bit.

Pay rates don't rise until the supply/demand balance for workers changes. The fact that the cost of living is high just means that people may move away if they can't afford to live in a particular area any more.

Along with it comes the fast growth of the other economic indicators - more people get more vehicles etc. These things will start congesting the infrastructure, which also would act as a deterrent for new companies.

Again with the indicators... And by "clogged infrastructure", what exactly do you mean? The public transportation in India is already pretty clogged, and it's not deterring anyone. Try riding on a bus there.

Now the option is to go to not so fancied (earlier) sites in India (or any outsourcing nation), so that you get everything cheap.

Makes sense, follow the cheap labor.

Since they saw the growth of fancied sites, they also would have improved the basic infrastrcuture to make it close to them.. without the current issues. But I guess Apple execs were lazy enough to not look at the new sites and stayed with the fancied ones. -- Yep, they had to pay for that.

I wouldn't chalk it up to laziness so much as aversion to risk. Why risk being the only American company on the block when Apple's excellent reputation for customer service is on the line?

I guess China skipped these issues by using far-sighted (and possibly evil) government policies - ex - they forcibly decreased the standard of living in many areas - which meant you get more people coming to urban centers - which means the demand and supply chain stays the same.

• -1: Incoherent

Was anyone leaving the big cities in China? Why did they need more people there to keep "the demand and supply chain stays the same"?

Also they improved the infrastructure by pouring in money for the same + they started builiding up a lot of suburbs to decrease the rising land-rates.

Yes, the Chinese gov't crated suburbs, mostly so that upper-class workers in the sities would gave a place to live that wasn't outrageously expensive. I don't think they did it to "decrease the rising land-rates", whatever that means.

Re:India to start losing jobs.

[Red Flayer]

Awesome.

Some Indian guy yelling bhen-chod at a Nigerian... love it. Though from my experiences with most of my Indian friends, it would be more likely to be a racist epithet.