According to a report by Bloomber, the Indian government is trying to restrict Chinese companies from selling mobile phones priced below 12,000 rupees (about 1,018 yuan) in the Indian market. India’s move will force Chinese smartphone companies to withdraw from the low-end price of less than 1,000 yuan. The mobile phone market, driving the development of India’s local smartphone industry. However, the Mintel in India believes that India’s local mobile phones are not capable of filling the market gap after the withdrawal of Chinese mobile phones.

Bloomberg said that according to data from market research firm Counterpoint, smartphones below 1,000 yuan accounted for one-third of India’s mobile phone sales in the second quarter of 2022, of which up to 80% were occupied by Chinese companies. The best-selling mobile phone brands of Chinese companies in the Indian market are mostly concentrated in the range of RMB 400 to 3,400 yuan. The best-selling mobile phone brand is Xiaomi, and the average price of Xiaomi mobile phones in the Indian market in the past three years is around 999 yuan. Other Chinese brands such as Transsion and Gionee are below this price line, while OnePlus and Vivo are generally priced above the thousand-yuan mark.

In the current public reports, there is no mention of what specific measures India will take to restrict Chinese companies from entering the low-end smartphone market. Similar operations are not new in India. For example, India did not have a clear decree to restrict the communication equipment of China’s Huawei and ZTE from entering the Indian telecom market, but these two Chinese manufacturers have actually been banned from entering India’s 5G market. Since July this year, Indian law enforcement authorities have raided the production and operation sites of many Chinese mobile phone manufacturers in India, and Chinese smartphone suppliers such as Xiaomi have been accused of money laundering or evasion of tariffs.

The Mintel reported that according to the quarterly report released by market research firm IDC on Monday, due to rising inflation and high input costs, India’s demand for smartphones is shrinking, resulting in high retail prices. The average selling price of smartphones in India reached a new high of $213 (approximately Rs 16,957) in the second quarter of 2022.

Relevant persons in charge of Chinese companies in India believe that the rumored restrictions sound far-fetched. If India strictly implements the measures, many Chinese mobile phone brands targeting the low-end market in India may withdraw from the Indian market.

Bloomberg took Xiaomi as an example and analyzed that if India imposes a ban on Chinese mobile phones of 1,000 yuan, Xiaomi smartphone shipments may drop by 11%-14% annually, or 20 million to 25 million units, and sales will drop by 4%-5%.

Analysis said that the Indian government is trying to introduce a ban on Chinese mobile phones in order to revive local Indian brands. Taron Pathak, research director of the smartphone field at Counterpoint Research, said that in the field of mobile phones below 1,000 yuan, Samsung mobile phones account for about 15% of the market share, and local mobile phone manufacturers in India account for about 4%-5% of them. Pathak warned that if Chinese mobile phones below 1,000 yuan are completely banned, Indian mobile phones will not be able to fill this market gap in the short term.

IDC India research director Nakendar Singh also believes that if such a ban is implemented immediately, existing Indian mobile phone manufacturers will not be able to fill the gap in the market of this size.

The Mintel analyzed that at present, most Indian mobile phone brands have limited influence, but they have not given up the market. Local Indian brands Lava and Micromax have launched several new smartphones since mid-2020, following a boycott of Chinese brands triggered by the Sino-Indian border conflict. Katri, a partner at retail chain Mahesh Telecom, said local Indian manufacturers, including Lava and Micromax, have been trying to increase by “increasing their marketing efforts” at offline retail stores following the recent government crackdown on Chinese brands. Influence. But Katri added that Indian brands do not have the scale of Chinese brands in terms of shipments.