In a report by research firm Counterpoint, we found this set of data:
From 2014 to now less than ten years, India’s imports of cell phones from China have plummeted from 180 million to 2.19 million.
And India’s proportion of self-produced and self-sold cell phones, but also from the beginning of the 19% growth to the current 98%, and even news that India almost do not need to import cell phones from China.
Take the iPhone 15, for example, which has just been released, and which “Made in India” has already been involved in the first wave of sales.
This is also the first time that Apple has realized mass production in India before the release of a new model.
Last year, the iPhone 14 shipped in India half a year later than in China, and even a few years further back, India could only produce the previous generation of iPhones.
Now, not only will India be able to produce the new iPhone at about the same time as China, but Apple has also revealed that it plans to move 25 percent of its production lines to India by 2025.
Until now, most people certainly didn’t take Indian cell phone manufacturing too seriously, and there was a real glut of weird news from the country that was sometimes even entertaining to watch.
But from Counterpoint’s data and the shift in iPhone production capacity, it seems like all the articles are saying that India’s cell phone manufacturing industry is now stronger.
For a long time now, people have been more or less underestimating India’s phone manufacturing industry.
Take the whole machine assembly, in 2014 before, can make a complete smart phone in India, only Samsung one.
With the release of a series of investment policies in India, a number of cell phone manufacturers have disregarded the previous foreign enterprises in India’s “misery”, straight to the meat and potatoes of the Indian market. Investment investment, factory building factory.
Like Mi, OV and other cell phone manufacturers, at that time in the domestic cell phone market has reached a bottleneck, is also a decisive choice to go to sea in India.
At first they just exported the whole machine to earn a little money.
But after tasting the sweetness, these cell phone manufacturers gradually bold, began to invest in building factories, focusing on the development of the Indian market. Now, Mi alone has built seven factories in India.
Not only Mi, OV these domestic brand manufacturers, like the domestic well-known ODM (original design manufacturer) manufacturers wisdom HaiPai and Shanghai and Germany and other cell phone assembly factories also see the itch, began to transfer part of the production line to India.
At present, can produce the whole machine in India, just domestic manufacturers, there are more than 15. Production capacity, not to mention, in 2015, India has surpassed Vietnam to become the second largest cell phone manufacturing country.
Now, the assembly of smartphones in India as a whole is nearly twice that of Vietnam, and roughly a quarter of the domestic assembly.
And, India’s ambition has not only to meet the self-sufficiency of the country’s smartphones, but also reached out to the export of this piece. In the export of the whole machine, India in the past few years is also quite good.
During the nine years of “Make in India”, it has exported more than 2 billion units of the whole machine to the outside world.
Last year, 16% of the whole machine assembled in India were exported to other countries, and even in April and May this year, India’s smart phone exports reached 200 billion rupees, more than double the 900 billion in the same period last year.
Countries like UAE, USA, Holland, UK and Italy have been groomed by India as its fifth most stable ” customers”.
Even Rajiv Chandrasekhar, India’s Minister of State for Electronics and Information Technology, has made a bold statement that next year, cell phones will be one of the top 10 categories of Indian exports.
Picture of course, India’s whole machine manufacturing development up, upstream cell phone parts and components manufacturing will naturally be driven up.
Whole machine manufacturing in India to complete the layout of the production line, the card profit link runs to the head of the imported spare parts.
In order to cut these unnecessary expenses, cell phone parts manufacturers have also begun the transfer of production lines, such as Terra Nova Communications, HCLT, Changying Precision and so on have moved some of the parts production lines to India.
To cite the most intuitive example, in 2018, more than half of the manufacturers in the Indian cell phone market had to rely on imported semi-finished products, and only one-third of them imported their own parts for assembly.
And in 2019, this data came to a big flip, two thirds of the manufacturers have realized their own imported parts assembly, no longer rely on assembled semi-finished products.
Now, nearly 80% of the assembled cell phone parts, including motherboards, battery modules, packaging materials, and other components, manufacturers can completely buy locally in India.
Not only that, the transfer of parts manufacturers to India continues. Some time ago, the world’s largest foundry in the field of 3C Hon Hai (Foxconn) announced that it would make a big move in the Indian market, throwing 50 billion rupees to expand the cell phone parts and semiconductor business there.
India’s progress is indeed rapid, but, some media say ” India’s cell phone industry will soon surpass China “, is still too early.
Already at the bottom, how to go is up. Indian cell phone market appeared so exaggerated results, a large part of the reason is that its starting point is low enough.
After all, when the domestic smartphone market has been fighting to the end, on the contrary, India, has just started. In India began to make an impact in 2014, India has more than 900 million registered cell phone users, but the coverage rate of smart phones is pitifully small, less than 20%, only about 120 million people are using.
Equally important, labor costs in India are really too cheap. The minimum wage offered by the government is 178 rupees a day, which translates into 2 dollars.
Huge blue ocean market plus cheap labor, as long as when the Indian government a little turn, the major cell phone manufacturers will naturally run over to invest.
And from the point of view of India’s development over the years, their government is a little too able to live, uncertainty is too high. According to reason to develop the cell phone manufacturing industry, you have to get their own business environment, play their own human advantage, to create a win-win situation.
However, look at India’s policy changes in the past few years, it is clear that it puts the center of gravity to another means, by erecting trade barriers raw ” rob ” supply chain. Like Mi, OV these domestic cell phone manufacturers, more or less in India to build factories are a little pushed to go.
In 2016, in the implementation of ” Make in India ” less than two years, the Modi government began the whole job. In the years that followed, the tariffs on cell phones and their components were like rockets, soaring.
Among them, the tariffs charged on the whole cell phone is the most, the highest tax rate reached 20%, such as batteries, chargers, adapters, these cell phone parts are relatively low, the average tariff is 15%.
Now in front of the Chinese cell phone manufacturers have only two choices: either to give up the Indian market, or to build factories in the Indian market.
Of course, Mi these cell phone manufacturers choose the latter, after all, there is no more flavorful market than India.
When a group of domestic manufacturers to build the plant is almost, India and out of the preparation for further harvesting.
These two years, India’s tax review is a wave after wave, almost all domestic mainstream cell phone brands have not escaped.
Mi India was accused of tax evasion of 6.53 billion rupees, vivo in India 119 related bank accounts were frozen, OPPO was also required to pay nearly 43.9 billion rupees in taxes.
This battle, all the glory just out of the sea to dry blind, overnight fled out of the Indian market.
Even three months ago, the Indian Law Enforcement Agency threw out a document saying that it would confiscate the 4.8 billion yuan that Mi had frozen last year.
The industry chain is attracted to the industry chain and then engage in some trade barriers, in the end, they all become their own.
Although at present, India gives “benefits” is quite good, a large wave of manufacturers are rushing to go there to invest in factories.
But India’s urbane people are also clear, before the lesson has been a lot, who do not want to become the next Vodafone.
So now go to India to invest in manufacturers, are cautious and cautious. Take Apple for example, the expansion in India is also like a dragonfly like a test.
Like the Modi government introduced the ” Make in India ” policy, the original intention was to foster local cell phone manufacturers to come. As a result, the Mi, OV and other brands directly occupied the low-end market.
Comparison in the “Make in India” program before the implementation of the four little dragons of India Micromax, Intex, Lava and Karbonn (collectively referred to as “MILK”), which can still snatch a little bit of market share from the hands of Samsung.
After 2014, they have been squeezed by Mi, OV and others. By 2021, the MILK four manufacturers in the hands of the market share of less than 1%, basically can be said to be out of the smartphone market.
Components, as mentioned earlier, many cell phone semi-finished products can already be assembled and produced in India. But the local counterpart of the most basic parts supply chain is not developed at all, most of them still rely on imports.
Last year, India also thought to help a local parts manufacturers, so in February 9th to limit the import of cell phone displays, lens modules and other parts of the cell phone components.
Next, the interesting came. Restrictions on imports, overseas imports of key components group was detained in customs. And local parts manufacturers simply can not hold up, resulting in cell phone manufacturers to interrupt the supply chain, the entire production line directly paralyzed.
So on February 24th, India made another emergency announcement, restoring the free import of parts.
Another example is Foxconn, it wants to transfer the industrial chain from China to India is not a new thing, but the transfer of 30% of the production capacity, it has been planning for five to ten years.
The reason why so slow, the key process is stuck in the cell phone parts this piece, apple assembly with almost 90% of the parts are China’s special supply.
Even if it shifts some production capacity to India, most of the assembly parts still have to be imported from China.
Now China’s annual export of goods to India, cell phone components and equipment has ranked first, amounting to 1.74 billion U.S. dollars.
India to really make the cell phone manufacturing industry to get support flange up, or have to first get their own hard power, the local cell phone supply chain to cultivate up.