Indian phone makers leave China to build at home

[Hellraiser007]

Indian phone makers leave China to build at home | ZDNet

Summary: Indian smartphone manufacturers, Maxx Mobile and Intex, start building local production lines as costs in China increase, but others say an ecosystem is needed before India is a viable manufacturing alternative.

Indian mobile phone manufacturers are planning to start assembling devices in their own backyard, due to rising costs in China and increase in import tax in India.

made-in-india
Ecosystem needed before India can be viable manufacturing alternative.
The Hindu reported on Sunday that Indian device manufacturers, faced with growing production costs which were further exacerbated by a falling rupee value, increased their product prices by between 6 and 12 percent in July.

The report added that local players, Maxx Mobile and Intex, will start building in Uttaranchal and Himachal Pradesh, respectively. Intex general manager, Sanjay Kumar, said the company will invest US$16.6 million (1 billion rupees) to set up two assembly lines in three to four months time.

Maxx will start production in its Uttaranchal facility in July.

The impetus for the move is rising production costs in China, which have increased by 20 percent recently, according to The Hindu. Additionally, the Indian government introduced tariffs for electronic goods imported into India--with a 7 percent tax on handsets priced above US$33 (2,000 rupees), compared to locally manufactured products which are taxed just 1 percent.

However, Karbonn Mobile's director Sashin Devsare said manufacturing in India was not a viable alternative because of an absence of an ecosystem and parts.

"There has to be an ecosystem first for local manufacturing to be feasible," Devsare, whose company is India's second biggest smartphone manufacturer, told The Hindu.

Sandip Biswas, director at Deloitte Touche Tohmatsu, also warned it might be more expensive to manufacture in India. "The absence of an ecosystem might lead to a situation where, despite local manufacturing, the price of the final product will still be higher than an imported offering," he said.

 

[Brahmos_2]

Indian phone makers leave China to build at home | ZDNet

Summary: Indian smartphone manufacturers, Maxx Mobile and Intex, start building local production lines as costs in China increase, but others say an ecosystem is needed before India is a viable manufacturing alternative.

Indian mobile phone manufacturers are planning to start assembling devices in their own backyard, due to rising costs in China and increase in import tax in India.

made-in-india
Ecosystem needed before India can be viable manufacturing alternative.
The Hindu reported on Sunday that Indian device manufacturers, faced with growing production costs which were further exacerbated by a falling rupee value, increased their product prices by between 6 and 12 percent in July.

The report added that local players, Maxx Mobile and Intex, will start building in Uttaranchal and Himachal Pradesh, respectively. Intex general manager, Sanjay Kumar, said the company will invest US$16.6 million (1 billion rupees) to set up two assembly lines in three to four months time.

Maxx will start production in its Uttaranchal facility in July.

The impetus for the move is rising production costs in China, which have increased by 20 percent recently, according to The Hindu. Additionally, the Indian government introduced tariffs for electronic goods imported into India--with a 7 percent tax on handsets priced above US$33 (2,000 rupees), compared to locally manufactured products which are taxed just 1 percent.

However, Karbonn Mobile's director Sashin Devsare said manufacturing in India was not a viable alternative because of an absence of an ecosystem and parts.

"There has to be an ecosystem first for local manufacturing to be feasible," Devsare, whose company is India's second biggest smartphone manufacturer, told The Hindu.

Sandip Biswas, director at Deloitte Touche Tohmatsu, also warned it might be more expensive to manufacture in India. "The absence of an ecosystem might lead to a situation where, despite local manufacturing, the price of the final product will still be higher than an imported offering," he said.

Good work by GOI to control trade deficit with China


So many companies are leaving China due to increasing production costs This is a good opportunity for India to attract FDI.

 

[acid rain]

What is the ecosystem that they are all talking about? I think they are asking something like the heavy subsidies that the Chinese provide to their industries.

 

[HK Indian MBT]

I told it in many other thread too. Chinese economy is slowing down.

 

[Echo_419]

Good thing for India we need them more than China
hope Karbon & Micromax join the fray

 

[Manindra]

What is the ecosystem that they are all talking about? I think they are asking something like the heavy subsidies that the Chinese provide to their industries.

Ecosystem is an business environment which provided by respective governments of the countries to manufacturers like hurdle free bureaucracy, proper infrastructure, availability of skilled & unskilled man power, proper taxation etc.

In india some sector have very silly taxation which can you understand from this example, Astra Microwave is a private company who make Radar components & their products on company gate is more expensive then if they first export same product to Israel then reimport them.

 

[Rajaraja Chola]

What is the ecosystem that they are all talking about? I think they are asking something like the heavy subsidies that the Chinese provide to their industries.

Still they are importing processors, screens and many vital parts for assembling. That ecosystem is lacking, i think. We need to ask such companies to have manufacturing base in India

 

[acid rain]

Ecosystem is an business environment which provided by respective governments of the countries to manufacturers like hurdle free bureaucracy, proper infrastructure, availability of skilled & unskilled man power, proper taxation etc.

In india some sector have very silly taxation which can you understand from this example, Astra Microwave is a private company who make Radar components & their products on company gate is more expensive then if they first export same product to Israel then reimport them.

All Indian manufacturers should forn an group and pull out altogether and ask the Govt for the needed ecosystem.

 

[HK Indian MBT]

Its going on for long time now. But our Stupid Corrupt govt dont make use of it. If India at this stage had a Leader like OBAMA who trying to steady ecomony out of nothing in America and many other countries like Brazil, South Korea etc would had made India into a International Hub for industries and Growth. God Save My Mother land. Sad to see Bharat Mata at this kid of situation.Where National Threat like terrorists and Corrupts are having a free run. Like in BANANA republic

What India dont have ? We have everything for becoming Super Power From money to High skilled Man Power.

Indian people should be blamed too. For selfish mentality. CHALTA HAI attitude. Look at the people of Egypt,germany and EU countries people protest to get rid of underperforming govt. Only in India people elect corrupts again and again.

 

[djsjs]

bought parts from this street and assemble at home.

 

[HK Indian MBT]

All Indian manufacturers should forn an group and pull out altogether and ask the Govt for the needed ecosystem.

They been asking for years now. NO USE. Politicians have their own intrest than National Intrest. Name any one politician WHO WANT TO SEE INDIA as a Super power nation ? Apart from NarendraModi ?

 

[Manindra]

All Indian manufacturers should forn an group and pull out altogether and ask the Govt for the needed ecosystem.

Yes they do like all private companies in defence sector make request to government but I think new system will implement in next 20-25 years when its already outdated.

 

[liall]

I told it in many other thread too. Chinese economy is slowing down.

It might be true but you got to analyze better. They are coming back because production in China is getting costly not that anything wrong with China. And that is happening cuz China is becoming richer and production will move as the labor gets expensive. It is just like how manufacturing moved from West to China similarly it is moving from China to India/bangladesh etc.

 

[HK Indian MBT]

It might be true but you got to analyze better. They are coming back because production in China is getting costly not that anything wrong with China. And that is happening cuz China is becoming richer and production will move as the labor gets expensive. It is just like how manufacturing moved from West to China similarly it is moving from China to India/bangladesh etc.

@liall Let me put my point in detail. China's economic boom is mainly due to Infra with in China , Export- Cheep labour force in turn cheep goods , Undervalued Chinese currency etc. These are three main pillar of chinese growth for the past 40+ years or so.

Now what is wrong with China's economy today and in future ? : Since chinese already invested many billions perhaps trillions into building NEW CHINA. Its already the best in the world. But whats is happening now is What will happen to the millions of labour force who worked for these infra projects if there is no more new projects. I say no more it means decrease in such projects. So china is adopting new way to get these labour force paid.Do you know what it is ? Destroy the newly built building and Bridges and built a new one Am not making it up but its true. So from now on Chinese are messing it up.Just to keep their Job Security afloat. Will it work? May be for a while but not in long term.

Major problem China is and Will face is its aging Chinese population. I dont kn ow about Canada but Sure u know abt USA's pension problems. Its a big Frankenstin monstr for any Nation. China will have the world's largest old population in the world. Thanks to chinese medicare

Now lets come to ur analysis on Production : You , Me or anyone will buy chinese products not because its of good quality but because its cheep. Just google it on protest taken place in China by Workers to increase their wages. Today china is developed
(-) Minus country . To be fair. Its still not a developing. Chinese economy boost increased the demand for HIGH LIFE STYLE. More and More people now want highly paid jobs but before they wr happy to work for cheep Pay. This will leads to increase in production price. Which will challenge Chinese products at global stag. If am understood properly You said the same i guess. But you are naive to the facts that Its the also the problem caused due to all arround Problems of CHINA. Hope you will change ur thoughts on Chinese Bubble Growth waiting to burst. China need to move outside its border and for infra projects to keep their economy afloat. Now China's GDP is 7.5% and it is ment to decrease in comming years.

Sure India will keep cashing IN,.So far India is been a Service Hub not the Manufacturing Hub. But now Indian Bussiness Community inside and Outside India wants the Govt of India to have good and Sensible response towards Manufaturing Sector. India will have nearly 600 Million under 27-35 which will be so till 2050 or 2070 . So India got huge working population , Money , Resources What else We need for a Next Super Hub for Industries ? Companies are very cleaver and Known about these fact they are starting invest more into Indian Economy. Its 1.2 Billion people ready to spend their Money . Its win win for both Consumer and Seller . Its great future for India . I really belive. India just need a Decent Well educated, Development oriented Leader To Make Use of this great Advantage India Has . Hope It will be Narendra Modi in 2014

 

[HK Indian MBT]

Chinese will try the US way Which is to Create Problem to India and Derail its Economy with small War and Threat . But Chinese also know its not going to happen without a Great Loss to China as well. It will be a Sucide for Chinese Growth if it go to war when Whole lots of Gang Waiting for right time to take Revenge (For bullying )