According to a new Bloomberg report, the Indian government has planned to ban Chinese phones cheaper than Rs. 12000 which would be another setback for Chinese businesses. The Indian government has taken the decision to encourage domestic smartphone manufacturers. If the decision is made, it would undoubtedly affect sales for companies that have dominated the market for inexpensive smartphones for a number of years, including Xiaomi, Poco, and Realme, among others.
The move is also aimed at pushing smartphone and tech companies out of the lower segment of the world’s second-biggest mobile market-Bloomberg reported. Earlier, the capital city Delhi launched several investigations into Chinese firms. As a part of the investigation, inquiries on the use of Chinese smartphones have also begun.
The Chinese company Xiaomi and its peers have increasingly relied on India to drive growth in recent years. However, if this move by India occurs, the Xiaomi market would be hurt more. Indian companies such as Lava and Micromax have rapidly gained popularity since their inception a decade ago, but have lost market share to fierce competition from Chinese players.
According to market tracker counterpoint, smartphones under Rs.12000 contributed a third of India’s sales volume in the quarter ending June 2022, with Chinese companies accounting for up to 80% of those shipments. India has also tightened rules for Chinese companies investing in India, citing security concerns in banning more than 300 Chinese apps.
Meanwhile, the move shouldn’t affect Apple Inc. or Samsung Electronics Co., which makes their phones more expensive. Representatives of Xiaomi, Realme and Transsion did not respond to requests for comment.