India’s import of mobile phones from China has dropped, while India’s import of mobile phone components has significantly increased, indicating that Make in India program did not work well, Hindustan Times reported.
India’s import of mobile phones from China has dropped to $3.3 billion in 2017 from $6.3 billion in 2014, according to a study conducted by the ministry of commerce and industry.
India’s import of parts of mobile phones as well as telecom equipment from China increased from $1.3 billion in 2014 to $9.4 billion in 2017 – showing that Make in India program did not work well.
The total import of mobile phones and telecom parts increased from $7.6 billion in 2014 to $12.7 billion in 2017.
“Through the assembly of final telecom products in India, the Chinese firms started assembly in India but as yet import substantially from home country to support the assembly line”, the study says.
These findings capture the challenge of promoting domestic manufacturing to reduce import dependence in skill-intensive products in India.
A company setting up a smartphone manufacturing facility in India might only lead to the final assembly of a product while bulk of the inputs, which have a big share in the overall cost of the equipment, might still be imported.
These findings also raise questions about the claims and setting up of targets vis-a-vis mobile phone manufacturing by the current government in India.
The Indian Cellular Association in April 2018 informed the telecom and IT ministry that India had become the second largest mobile phone manufacturer in the world.
The India government in late 2014 set the target of 500 million mobile phones to me made in India by 2019 and later revised to 1 billion units by 2025.
The increase in mobile phone manufacturing within the country is a result of the Phased Manufacturing Program, which mandated localization of manufacturing activity.
