Recent developments for the smartphone market in India

India is one of the most popular destinations for smartphone companies, having as many mobile users as the entire population of the United States.

Therefore, it is not surprising that India currently currently stands as one of the largest mobile phone manufacturers in the world, second only to China. After having registered an impressive 14.5% growth in 2018, the Indian smartphone market, according to the data published by IDC’s Asia/Pacific Quarterly Mobile Phone Tracker, had an impressive start in the first quarter of 2019, with a total shipment of 32.1 million units and a 7.1% year-on-year growth.

Among the various investments related to the smartphone market, we may recall the 745.82 million USD investment performed by Samsung for the expansion of the manufacturing capacity of its Noida plant, which was formally inaugurated in July 2018, as well as the expansion project made by the Chinese smartphone maker Vivo, which is planning to invest approximately 560 million USD in order to expand its 202k sqm manufacturing facility in India with an additional 684k sqm.

A huge step towards the further development of the sector is also represented by the announcement made by Foxconn Technology Group, the largest assembler of Apple Inc’s handsets, that it will move the production of iPhones from China to India within the end of 2019, with an estimated initial investment of about 300 million USD.

Foxconn already has two assembly sites in Andhra Pradesh and Tamil Nadu, where it makes devices for both Xiaomi and Nokia. The production relocation to the southern city of Chennai may help to diversify Apple and Foxconn’s manufacturing footprint away from China amid the ongoing trade tensions with the US, as well as to significantly an increase of Apple’s presence in the Indian market, which has been discouraged by the high prices and the import duties, amounting to 20%. Producing phones locally would also help Apple’s retail push in India, as the company shall meet a 30% local sourcing rule to be entitled to open its own stores in the country.

Mr. Karn Chauhan, Research Analyst at the international analysis firm Counterpoint, has declared that “for Foxconn, the China market for iPhones is saturated, and labor costs are three times higher compared with India. India is still an emerging smartphone market, it has a lot of potential domestically and could serve as an export hub for the region.”

Such important investment news confirms an important growth trend for the smartphone market in India, which is estimated to reach a number 442.5 million smartphones users in 2022.

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