India mobile supply chain grows with the help of Chinese investments

India mobile supply chain grows with the help of Chinese investments

As the Indian government actively builds a self-reliant local electronics supply chain, the number of made-in-India smartphones has grown 16% annually, with the help of Chinese investments.

According to a report released by Counterpoint Research, made-in-India smartphones increased by 16% year-on-year to 44 million units in the second quarter. Counterpoint’s other report also said that India accounted for 16% of global handsets production in 2021, behind China’s 67% but ahead of Vietnam’s 10%.

According to Counterpoint, in-house manufacturers, such as Oppo, Samsung Electronics, and Vivo, account for 66% of made-in-India smartphones shipment in India, while Foxconn’s Bharat FIH, Dixon, and DBG are leading third-party manufacturers. China-based companies make up more than 40% of made-in-India smartphone shipments.

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Made-in-India smartphone shipment share (%)

Manufacturer

1Q22

2Q22

Oppo

20.2

23.9

Samsung

15.6

21.8

Vivo

13.3

14

Bharat FIH

17.5

9.8

Dixon

9.3

8.1

Others

24

22.4

Source: Counterpoint Research, September 2022

Meanwhile, Dixon’s Padget Electronics, Wistron, and Lava were the fastest growing smartphone manufacturers, with annual smartphone production increasing by 396%, 137%, and 110%, respectively.

According to the report, 100% of TVs are produced locally, and nearly 100% of smartphones and feature phones are made in India. Other consumer electronics also see emerging Indian local EMS companies, such as Optiemus, VVDN, and MIVI.

India’s domestic manufacturing contribution by product (%)

Product

Made-in-India share

Leading manufacturers

TV

100

Dixon, Radiant, Samsung

Smartphone

98.5

Samsung, Oppo, Vivo

Feature phone

97.2

Bharat FIH, MCM, Lava

Tablet

33.1

Samsung, Dixon, Wintec

TWS

16.2

Optiemus, Bharat FIH, MIVI

Neckband

8.4

VVDN, MIVI, Optiemus

Smartwatch

6.2

Optiemus

Source: Counterpoint Research, September 2022

Despite a souring India-China relationship, Chinese investments have significantly contributed to India’s mobile supply chain development. The Global Times quoted industry insiders saying that more than 15 China-based mobile phone vendors have invested in India. Except for integrated circuits and discrete components, Chinese companies are producing chargers, cables, cameras, headphones, PCBs, and display panels in India.

According to United Nations trade data, the proportion of capital goods in India’s imports from China has grown from 36.77% in 2012 to 44.62% in 2021, and the share of industrial supplies, primary or processed, has also increased from 40.81% to 46.16% in the same period, indicating India’s reliance on Chinese imports for machinery, equipment, and intermediate goods.

India’s imports from China (5)

Year

Capital goods

Industrial supplies

Consumption goods

Others

2012

36.77

40.81

8.34

14.08

2013

39.56

41.57

7.96

10.92

2014

40.59

44.79

7.46

7.16

2015

44.47

41.80

7.72

6.01

2016

48.29

38.07

7.68

5.97

2017

48.29

39.85

6.37

5.49

2018

43.11

44.15

6.86

5.87

2019

41.73

46.80

6.59

4.87

2020

45.26

44.05

5.94

4.75

2021

44.62

46.16

4.58

4.63

Source: UN Comtrade, compiled by DIGITIMES Asia, September 2022

To restore its mobile supply chain, India approved the Phased Manufacturing Programme in 2017, by which India hiked custom duties on imported mobile phones and components every year. In 2020, India launched the Production Linked Incentive for large-scale manufacturing to promote mobile phone exports from India.

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