Even without PLIs, Chinese brands lead in “Made in India” smartphone exports


Even though the mobile PLI program was intended to encourage local players to become global exporters, Chinese smartphone makers dominate the market when it comes to “Made in India” shipments.

While these shipments increased 16% year-on-year to 44 million units, a significant contribution continues to come from Chinese companies, which were excluded from joining the mobile PLI program for geopolitical reasons, according to an analysis. from Counterpoint Research.

way too early

The report showed that Chinese smartphone makers Oppo and Vivo saw their market share in smartphone shipments increase despite not being beneficiaries of the LIP. South Korea’s Samsung was the only PLI beneficiary to increase its market share. Meanwhile, Indian smartphone makers hold negligible market share or lost market share between T2 CY21 and T2 CY22.

“The market is currently dominated by Chinese OEMs and all of them have already made significant investments in India in setting up manufacturing capabilities. Which they did regardless of the PLI program as their intention was to leverage other benefits such as savings on import duties, market proximity and increase their engagement in a market like India , which is important to them but volatile due to political skirmishes from time to time. said Faisal Kawoosa, founder and chief analyst at TechArc.

The Center has pledged to disburse a series of grants in return for which the beneficiaries of the PLI have pledged to achieve a total production of ₹10.5 lakh crore in the next five years, 60% of the total production (6 ₹.5 lakh crore) being destined for global markets. This is done with the aim of reducing India’s e-commerce deficit with China.

However, despite benefiting from the first tranche of government subsidies, data from the Counterpoint report shows that Samsung is the only player to have increased its market share for smartphone exports from 15.6% at T2 CY21 to 21.8% at T2 CY22. . On the other hand, while Oppo’s export market share increased from 20.2% to 23.9%, Vivo increased its export market share from 13.3% to 14, 0%.

Meanwhile, most of the Indian LIP recipients such as Lava, Micromax and Optiemus did not hold any significant market share in this segment. Additionally, Dixon saw its market share increase from 9.1% to 8.3%.

However, the report notes that Lava leads the export market for feature phones with a market share of 22%. Feature phones have the lowest added value, especially as global high-income markets shift to 4G and 5G telecommunications networks, necessitating the need for smartphones.

cheap labor

Peeyush Vaish, Partner and Head of Telecommunications Sector at Deloitte, explained why Chinese smartphone makers don’t need India’s PLI program to manufacture smartphones, even for export.

“If you look at their demand in India, they have enough volumes to justify ramping up production for export purposes. Smartphone assembly is cheaper in India because our labor costs are cheap Therefore, it is no surprise that they dominate the market share,” Vaish said.

Published on

September 16, 2022


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