India may not ban Chinese phones under Rs 12,000 in the country: Report

A Bloomberg report had claimed that the government may restrict Chinese OEMs from operating in the sub-Rs 12,000 price range.

Highlights
  • An initial report had said that Chinese OEMs could be restricted from the sub-Rs 12,000 price band
  • Further reports on the matter now claim that no such ban will be put in place
  • Three of every 10 phones sold in India are priced below Rs 12,000

China-based phone makers, who are undisputedly the biggest smartphone brands in India for a while, may not be restricted from selling phones priced below Rs 12,000 in the country. An initial report by Bloomberg had cited government officials to claim that the centre is planning to introduce restrictions to Chinese OEMs in the country, in a bid to promote homegrown brands from gaining a stronger footing. However, now, a report by CNBC-TV18 has claimed the government does not plan to enforce any such bans — at least for now.

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How Chinese OEMs contribute to India

Even if the government may have considered such a ban, enforcing it would be difficult. A report by Mint cites industry experts who state that while over three out of every 10 smartphones sold in India are from the sub-Rs 12,000 category (hence making it a significant industry), Chinese OEMs account for close to 78 percent of the Indian smartphone market.

While USA’s Apple and Samsung make up close to another 20 percent of the Indian market, Indian brands such as Micromax, Lava and Karbonn hardly add up to around 1 percent of all smartphones sold in India.

IDC India smartphone market Q2 2022

On top of this, Chinese OEMs such as Xiaomi, Realme and Vivo, who are the top three smartphone brands in India and account for over 50 percent of all phones sold in India (as of a Q2 2022 report by IDC India), have also made investments to set-up assembly facilities in the country.

However, the Bloomberg report had stated that the government is wary of brands with deeper resources than Indian OEMs, such as Realme, is likely gaining footing in the Indian market by undercutting the industry standard of prices — which they may intend to rope in. For now, though, a contradictory report suggests that such plans have been put on hold.

A very strong range of offerings from Chinese OEMs essentially took Indian brands out of competition over the past six or seven years, in the world’s most exciting smartphone market. Going forward, it remains to be seen if the government does consider steps to enforce ways to bring Indian brands back to life — although industry experts state that doing so while keeping a fair trade policy would be difficult to enforce.