India looks to restrict Chinese smartphone makers from selling devices cheaper than 12,000 rupees (USD150). This is in pursuance of stimulating its faltering domestic industry. The move aims at pushing Chinese giants out of the lower segment of the world’s second-biggest mobile market.
High-volume brands like Xiaomi, Realme and Transsion are undercutting local phone manufacturers. Exclusion from India’s entry-level market would hurt these companies. Over the years, these companies have relied on India to drive growth. Smartphones under Rs 12000 contributed to a third of India’s sales volume for the quarter through June 2022. In this, Chinese companies accounted for roughly 80% of those shipments.
However, it’s still unclear whether the government will announce any policies or use informal channels to convey its preference to Chinese companies. The government has already subjected Chinese firms such as Xiaomi, Oppo and Vivo to scrutinising their finances. Allegedly, these companies are involved in money laundering cases. Instead of introducing an official policy prohibiting Chinese networking gear, the government may encourage wireless carriers.
In 2020, India vigorously pressurised Chinese firms when more than a dozen Indian soldiers died after a clash between the neighbouring countries on a disputed Himalayan border. Since then, it has banned more than 300 Chinese apps, including TikTok and WeChat.
Domestic companies, including Micromax and Lava, constituted just under half of India’s smartphone sales before entrants from the neighbouring country disrupted the market with cost-effective and feature-rich devices.