India: The Next Smartphone Export Powerhouse

The smartphone manufacturing industry has been growing steadily in India for many years. Originally, the focus was on producing units for the local market, but in the recent past, India has become a significant exporter of smartphones as well. This position is only set to become stronger, supported by the government’s “Make in India” drive, which seeks to encourage local production across various sectors.

In fact, according to research by techARC, 2020 could see Indian mobile phone exports cross the USD 1.5 billion threshold for first time, with 98% being smartphones. Currently, India exports smartphones to 24 countries, with some of these receiving countries going on to re-export the devices to other markets. The government has also introduced an effective PLI (production-linked incentive) scheme, which provides manufacturers with a 4 to 6 percent incentive on incremental sales in certain categories, one of which is smartphones.

An Emerging Mobile Hub
India’s favourable economic environment, coupled with government support is creating conditions that could help propel India to become a global powerhouse for the production of mobile devices. In 2020 alone, from January to September, 12.8 million mobile phones were exported from India, with 10.9 million of these being smartphones. While the industry was adversely impacted due to the global pandemic, it witnessed a strong recovery in Q3 as supply chains were restored and factories reopened.

In fact, according to some reports, India may soon be on par with and even overtake traditional mobile device export giants like China and Vietnam, as global and local giants like Apple, Samsung and Lava have all committed to ramping up manufacturing in India. The PLI scheme is also helping to reduce the cost of production, which is making India more and more attractive, globally.

Furthermore, tensions with China are also contributing to India focusing more on local production and creating supply chains that are not controlled by China. By creating security through strong manufacturing, India will be able to stand its ground against China and continue to exert influence in the region, while growing its economy.

USD 100 Billion in Smartphones Over Five Years
With Apple and Samsung both committing to produce phones for export in India, industry analysts project that India could possibly export upwards of USD 100 billion dollars’ worth of smartphones over the next five years. This is entirely reasonable as Apple has already committed to USD 50 billion in that period. These developments are creating massive opportunities for businesses of all sizes in India and could well trigger a much-needed economic boom as we emerge from the global pandemic.

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