Chinese smartphone manufacturers such as Xiaomi, Oppo, and Vivo currently control approximately 55% of the Indian smartphone market. The Indian government has directed Chinese smartphone manufacturers to include Indian equity partners in their domestic operations.
In addition, the corporations have been asked to employ Indian professionals to important positions such as chief executive officer, chief operating officer, chief financial officer, and chief technical officer.
Expeles think the decision to carefully oversee Chinese smartphone manufacturers is a much-needed step, and that they should contribute more to the Indian value chain. As a result, the government has directed them to hire Indian contract manufacturers, increase local manufacturing down to the component level through joint ventures with Indian enterprises, enhance exports from the country, and establish local distributors.
The action follows the Chinese smartphone manufacturers investigation for tax fraud and alleged unlawful payments of thousands of crores, which resulted in the freezing of local bank accounts.
Since last year, there has been a crackdown on Chinese smartphone manufacturers amid geopolitical concerns between India and China. Xiaomi was accused of making illicit remittances and breaking forex laws, while Vivo and Oppo were also charged with tax evasion by India’s enforcement department.
According to the most recent Counterpoint Research data, Indian 5G smartphone sales surpassed 50% in April of this year, with Chinese players accounting for 62% of the market.In the first quarter of this year, the Indian brand held less than 1% of the market, while Chinese smartphone manufacturers held 54%. Samsung is the only non-Chinese company with a 20% market share.
Despite weak demand, significant inventor01Y build-up carried over from 2022, increased consumer preference for used phones, and a negative channel assessment of the industry, smartphone shipments fell 19% YoY in QI 2023.
India is a massive market for Chinese mobile players. And, with half of the population still not linked to the internet, the future potential is huge. Indian mobile players are few in the industry, allowing Chinese players and others such as Apple and Samsung to maintain their dominance.
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