India’s evolving telecoms market: domestic smartphone manufacturing

The telecom industry in India has seen exponential growth over the last few years driven by many factors including inexpensive tariffs, roll-out of Mobile Number Portability (MNP) and expanding 3G and 4G coverage.

India will become the second-largest smartphone market globally by 2025 with 1 billion installed devices and is expected to have 920 million unique mobile subscribers by 2025 which will include 88 million 5G connections, according to the industry organization, GSMA.

In recent developments, Reliance Industries has asked Indian suppliers to manufacture up to 200 million smartphones over the next two years. This includes Reliance Industries manufacturing a smartphone that will be sold at INR4,000 ($54), run on Android. The smartphone will be marketed with low-price plans from the company’s operator Reliance Jio.

However, one such challenge will be opening a front with rival companies like market leader Vivo, Samsung, Oppo, Realme and Xiaomi. The latter controls the Indian market with a 30 per cent market share, shipping 5.3 million units in Q2 2020.

The move will be a game-changer in the status and ranking of telecom operators in the country, especially after 148.2 million smartphones were sold, last year, with mainly Chinese vendors dominating market share, Canalys figures noted. Now, the unofficial ban of Chinese vendors opens a door of opportunity for local enterprises to develop their smartphone products and gain competitive advantage in the domestic market.

Union Electronics and Information Technology Minister, Ravi Shankar Prasad confirmed that “India exported 36 million units of smartphones in FY 2020 as compared to 17 million units in FY 2019 which means a 111.76 per cent growth. In terms of value, smartphones worth Rs 21,000 crore were exported with a growth rate of 91 per cent in FY 2020.”