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India has emerged as the world’s second largest mobile phone manufacturer as its production of devices in terms of value has grown by over two times in FY22, the government has said.
In India, mobile phones worth Rs 5,277 crore were manufactured in FY22, up from Rs 2,334 crore worth of devices produced in FY21, the government said, crediting its production-linked incentive scheme for this feat.
“Due to the Production Linked Incentive (PLI) Scheme, India is currently one of the fastest-growing mobile phone manufacturers in the world and has emerged as the second-largest manufacturer of mobile handsets in the world in volume terms,” Union Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said in a written reply to a question in Parliament.
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The PLI scheme offers incentives of 4 to 6 percent to eligible companies on net incremental sales over the base year of mobile phones and electronic components manufactured in India for a period of five years. The Center has cleared the names of 16 companies to get benefits – 10 mobile phone manufacturers and six electronic component makers.
The country manufactured 30 crore mobile phones in 2020-21, up from 6 crore produced in 2014-15, according to government think tank Niti Aayog.
The number of mobile phone manufacturing units in the country rose to 200 from two during this same period.
With a compound annual growth rate (CAGR) of 6 percent, demand for smartphones in India is likely to reach about 40 crore in 2026 from 30 crore in 2021, according to a recent report by Deloitte.
“This high demand is likely to be primarily created after the launch of 5G, which alone will contribute 80 percent of the devices (about 310 million units) by 2026,” the advisory firm said.
As domestic production rose, India’s mobile phone imports decreased by 33 percent in FY22, according to CRISIL.
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