Indians aren't just non-stop on mobile phones, they are also making them
like never before.
Over the last four years, the country has seen a massive boom in the
number of mobile manufacturing units under the Narendra Modi government-
in fact, a 60-fold increase, if electronics and information technology
minister Ravi Shankar Prasad's July 12 tweet is anything to go by.
These factories, Prasad said, have created more than 400,000 jobs.
Data from independent research firms Prasad's claim.
In 2014, India had only two mobile-making untils, according to data
from Hong Kong-based Counterpoint Research. By the end of 2017, there
were 123. A number of foreign phone makers have entered the scene in
recent years. Just earlier this month, South Korea's Samsung set up the
world's largest mobile factory in the northern Indian state of
Uttar Pradesh.
Mobile manufacturing units in India are increasingly rapidly
However, industry experts add a caveat.
Most of these factories simply assemble parts imported from countries
like China, Tarun Pathak of Counterpoint said.
For example, Cupertino-based Apple has been assembling iPhone SE in
India and now reportedly plans to start assembly of the iPhone 6S, too.
Since manufacturing has beem India's forte for decades, the country
lacks an ecosystem of skilled labour and investments. Moreover, for
India to start making phones, it must undertake the herculean task of
setting up factories that manufacture the components.
The Manufacturers' Association for Information Technology (MAIT), the
apex body representing India's hardwere sectors, claims that the
newly launched goods and services tax regime favours IT importers over
small domestic producers in some cases.
"It will not happen overnight," said jaipal Singh, a senior analyst at
International Data Corporation (IDC) India. "It will take some time to
bring entire ecosystem in India."
In comparison, China is considered a faster and cheaper option by not
just Chinese and South Korean phone makers but even America's Apple.
In fact, China is a favoured manufacturing destination even among
Indian startups.
Nevertheless, analysts say even assembly moving to India is a good sign.
"The government's strict policies and customs duty hike has worked in
India's favour," said of IDC. "The fist step is to be able to shift
assembly to India. Some components are also being manufactured
locally already."