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With the Indian economy racing towards becoming the third largest in the world with its unprecedented growth in all its spheres, its digital footprint cannot remain behind. Mobile phones being the new tool to access not just the portal of knowledge, but also to network with the whole world need a newer vision and will to manufacture it within one’s own territory. Presently, 71% of the Indian population uses smartphones in India. Also, the average time that an Indian user spends on their smartphone in a single day is 4.9 hours. With the growing population, mainly the demand of the aspirational youth needs to be catered to with a Make in India spirit. How has India faired in this arduous endeavour of manufacturing mobiles in its domestic market space, what is its global impact, and what would be the road ahead is an interesting question to look into.
The Journey Embarked
India has come a long way in mobile phone manufacturing. We have seen local manufacturing increase over the years to meet domestic demand. In May 2017, the Indian government announced the Phased Manufacturing Programme (PMP) to promote the domestic production of mobile handsets. This initiative helped build a robust indigenous mobile manufacturing ecosystem and incentivised the players to build large-scale manufacturing. The PMP has successfully helped in nudging companies to move toward manufacturing from direct imports.
Today the telecom & allied industries are amongst the top employment generators in India. From just 3 mobile phone factories in 2014, India now has become the second largest mobile phone producer in the world. The target of the Union Government is to increase electronics manufacturing capacity to Rs. 24 lakh crore by 2025-26, which will also help create over 10 lakh jobs. India accounts for 30 million smartphone purchases every quarter, and this percentage keeps increasing multiple times a year. It also witnessed a sharp decline in the import of mobile phones at ₹600 crores during the first quarter of FY22, while it was as high as ₹3,100 crores during the same period in FY21.
In 2022, more than 98% of shipments in the overall Indian market were ‘Made in India’, compared to just 19% when the current government took over in 2014. We have also seen increasing local value addition and supply chain development in the country. Local value addition in India currently stands at an average of more than 15%, compared to the low single digits eight years ago. Many companies are establishing their units in the country for manufacturing mobile phones and components, leading to growing investments, increasing jobs, and overall ecosystem development. The government now intends to capitalize on its various schemes to make India a ‘semiconductor manufacturing and export hub’. In the future, we may see increasing production, especially for smartphones, as India aims to bridge the urban-rural digital divide and become a mobile phone exporting powerhouse.
The World is Using Made-in-India Mobiles
Exporting would be a far-off dream for a country that ‘just’ assembled mobiles a few years ago. Mobile phone exports in 2015-16 were near zero. Due to India’s flexible and accommodative policies and determined mindset, exports have crossed the $5-billion mark within seven months of FY23 and are estimated to be worth $9 billion in FY23. Also, the external conditions of major mobile manufacturers like China, Taiwan, and South Korea are seeing sluggish economic growth in the aftermath of the COVID-19 pandemic. This needs to be capitalised by capturing a substantial share of the market by increasing our capabilities. Honourable Prime Minister has said, “The world is seeing India with a ray of hope. India believes in taking everyone together.” This is India’s time; we must capitalise on it to build a sustainable and glorious future for our young generations. The world now recognises India’s technological strength and capacity; it’s time to sustain and concretise this perception.
The Promising Road Ahead
India envisions an ambitious plan to scale annual mobile manufacturing to $126 billion by 2025-26. Currently, PLI has approved production of over Rs.9,00,000 crore, which is a significant amount that can be put in the necessary capital. The Government’s dynamic policies, i.e., adapting with time and following a bar-bell strategy, will pave the way further for the mobile manufacturing industry. India’s heavy internal demand and the Government’s progressive plans are attracting FDI and interest from other countries; India is becoming the preferred destination for the world and is an emerging ‘ray of hope’. Booming mobile manufacturing is a critical step in India’s Digital revolution, a revolution that is changing every Indian’s life, transforming our way of life, and catering to the demands of the world by storm.
The mobile industry’s success story underscores India’s capacity to transition from being predominantly import-dependent to emerging as the key manufacturer of mobiles on the global level. As India establishes its status as a manufacturing hub for mobile devices, the “Made in India” tag has now become a co-terminus with quality and innovation. As these indigenous smartphones ascend to new heights, they symbolize a transformative journey towards economic growth, and technological prowess in the realm of mobile manufacturing.
Author : Amey Velangi
Author Description : He is an enthusiastic budding researcher with a strong background in international relations, strategy, foreign policy, and geopolitics. He has completed his Master's in Public Administration and Public Policy. PG Diploma in International Relations and Diplomacy. He is currently a Fellow at Chanakya University in Bangalore.
Disclaimer : The views, thoughts, or opinions expressed in this blogs belong solely to the author, and do not necessarily reflect the views of author’s employer, organisation, committee or any other group or individual.
