Jai Ho! India says hello to world.
MUMBAI: Buy a Nokia phone in Cape Town or a Samsung handset in Colombo—they may well carry a ‘Made in India’ tag. The fastest-growing mobile market Facts on mobile connections is also one of the largest exporters of mobile handsets.
The country’s not just a small car hub, handset manufacturers such as Nokia, Samsung, LG, Sony Ericsson and Motorola are shipping 60 million mobiles each year from the country to more than 60 countries mostly in Africa, South-East Asia, Middle East and South Asia.
“India has a conducive business environment and skilled manpower; it is a poised to become telecoms manufacturing hub of the world,” says Sachin Saxena, Nokia India’s director for its factory at Sriperumbudur, Chennai, the largest firm’s biggest facility.
India, which accounts for one in every 10 handsets made in the world, now plans to more than double its production from 120 million devices in 2009 to 250 million units by 2012.
Out of this, 100 million will be exported, according to Pankaj Mohindroo, national president of handset maker’s industry body Indian Cellular Association (ICA). “We have set up manufacturing advisory committee to provide guidelines for strengthening exports in consultation with the Telecom Products & Services Export Promotion Council,” he says.
While the target may look ambitious, that’s because the growth has been phenomenal so far.
Nokia’s Chennai factory, which started operations in January 2006 with 550 employees, today employs more than 8,000 people and crossed cumulative production of 250 million units in April. Nokia ships its devices from India to more than 50 countries. Samsung’s handset factory at Noida near Delhi is rolling out a million units everyday with one in every ten units being exported. “The trends we see in India are very much in sync with what we see in overseas markets,” says Ranjit Yadav, director—IT & Telecom at Samsung India.
The Noida complex, employing around 500 people, enjoys the highest productivity among Samsung mobile manufacturing facilities worldwide.
The country mostly manufactures lower-end devices. Nokia’s Chennai factory is making handsets in the range of Rs 2,000-7,000. Samsung’s made-in-India portfolio, however, includes its popular touch screen phone, Samsung Star, priced at Rs 14,000. The product crossed sales of 10 million units within the first seven months of its launch.
Motorola launched the first ‘made in India’ mobile in December 2005 with a price tag of Rs 1,700. That was the start of a boom bettered only by the growth in the mobile market. Samsung’s Yadav says the company would have exported more if not for domestic demand.
And they see more growth. Only 480 million users possess a mobile in a population of 1.15 billion. “We will be enhancing our capacity to fully leverage the potential of this market,” says Mr Yadav.
But the picture is not all rosy. Lack of mature component supply base is a problem faced by manufacturers. “At present, most of the components are imported. In order to achieve greater indigenisation, a holistic approach towards improving the electronic manufacturing ecosystem comprising of vendors needs to be in place,” says Mr Saxena of Nokia.