More 'Make In India' Mobile Phones In 2015

by CXOtoday News Desk    Aug 31, 2015

mobile tech

The Videocon group has recently started manufacturing mobile handsets in at its Salt Lake factory in Kolkata. With an initial investment of around Rs 50 crore, and production capacity at 3 million units per annum, the Kolkata facility would be manufacturing feature phones, which makes up almost 40 percent share of the mobile phones market, and later that the unit would also make smartphones and tablets.

Not only Videocon, in the past few months, several mobile manufacturers have announced their plans to make handsets in India instead of sourcing from China. While some have already embarked on new projects, some other have started scaling up.

The India drive

The Indian mobile phone industry is reportedly expected to reach Rs 100,000 crore in 2015, which will give impetus to the Government’s ‘Make in India’ drive. The industry registered a turnover of Rs 75,000 crore in 2014. Though smart phones account for about 25 percent in numbers, however contribute three times as much in turnover.

India’s largest phone maker Samsung, has been manufacturing in India for nearly a decade, has spent more than Rs 500 crore to add capacity at its plant in Noida where it makes many models, including the Tizen-powered Z1, Galaxy S6 and S6 Edge.

China’s Lenovo has started making smartphones in India through contract manufacturer Flextronics at Sriperumbudur near Chennai. The Flextronics’ unit has started rolling out two of Moto E smartphone’s 4G variants and will soon start making another 4G device Lenovo K3 note,” the company said in an official release. Amar Babu, Chairman and COO, Asia Pacific, Lenovo India said, “The Indian government’s ‘Make in India’ program offers a plethora of opportunities for organizations looking to conduct business in India.”

Chinese phone maker Gionee plans to invest Rs 300 crore over the next three years. Xiaomi also partnered with Foxconn to set up a mobile phone manufacturing unit here as the Chinese technology major looks at grabbing a larger share of the booming Indian handset market.

On the domestic front, mobile handset major Micromax has started a plant at Rudrapur in Uttarakhand and is planning investments in Telangana, Rajasthan and Maharashtra. Lava has invested Rs 50 crore to build a facility in Noida to assemble one million units a month. 

Karbonn is also investing Rs 200 crore in two plants, in Noida and Bangalore. Similarly, Spice Mobility is investing Rs 500 crore in Noida to build a facility it says will be up and running by the next quarter.

A major boost

According to a Reuters report, the government has received Rs 90,000-crore investment proposals in the last two months for electronics manufacturing in India. Both local and foreign companies are showing interest in making mobile phones in India, said Ajay Kumar, Additional Secretary, Ministry of Communications and IT, who sees that India has already become the fastest-growing smartphone market.

The Ministry of Communications and IT has formed a “fast-track task force,” group of phone sellers, tax advisors, skilling experts and bureaucrats, in order to boost significant growth” in mobile manufacturing. The group stated that in order to achieve production of 500 million units of mobile handsets by 2019,which includes, annual manufacturing output of Rs 150,000 crore to Rs 300,000 crore or 20 to 25 percent of total global manufacturing.” Experts believe if this figure is achieved, there would be an additional 1.5 million jobs in the country.

Clearly the Make In India is having a key impact on the mobile handset industry. As M.N. Vidyashankar, President, IESA comments, “We expect 2015 to bring a major shift in the electronic manufacturing paradigm. Based on the various proposals that have been submitted during the last couple of years, the manufacturing activities will pick up pace – particularly during the second half. (To read the full interview, CLICK HERE.)