MUMBAI (Reuters) - Apple Inc <AAPL.O> has increased the prices of most of its iPhone models sold in India after the government last week raised taxes on imported phones in a bid to boost domestic manufacturing.
Barring its locally-assembled iPhone SE model, Apple raised prices of iPhone handsets by an average 3.5 percent, according to a price sheet reviewed by Reuters.
Its priciest iPhone X model now costs 105,720 rupees ($1,646.61) for a 256 gigabyte (GB) variant, according to Apple's India website, an increase of 3.6 percent. The price of a 256 GB iPhone 8 has risen by 3.1 percent to 79,420 rupees.
As Prime Minister Narendra Modi's government strives to boost manufacturing of phones in India - the world's second-biggest market by mobile subscriptions and among the top three countries by annual smartphone sales - it last week raised the customs duty on phones to 15 percent from 10 percent.
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That was set to make imported phones, including Apple iPhones, costlier. Some other top phone brands, such as Samsung Electronics Co Ltd <005930.KS> and Xiaomi, assemble the majority of their phones sold in the Indian market locally.
Apple's Taiwanese contract manufacturer, Wistron <3231.TW>, assembles the iPhone SE in the technology hub of Bengaluru in southern India.
Apple also has plans to expand local manufacturing in India but wants a range of incentives and tax breaks from the federal government which New Delhi has yet to agree to.
An analyst said a small increase in the price of iPhones was unlikely to dent Apple's less than 3 percent market share in India, where it's seen as an aspirational brand but its steep pricing puts it beyond the reach of many.
"Apple's halo as a premium brand in India cannot be taken away by this meager price rise," said Navkendar Singh of technology researcher IDC.
Basic or feature phones still comprise a large chunk of India's roughly 750 million mobile phones, although sales of smartphones are growing faster. Alphabet Inc's <GOOGL.O> Google earlier this month unveiled a new version of its Android mobile phone software with an aim to power low-cost entry-level smartphones.
(Reporting by Sankalp Phartiyal; Editing by Louise Heavens)