India’s ambitious push for self-sufficiency in mobile phone assembling is yielding results. India shipped 2 billion domestically assembled smartphones and feature phones between 2014 and 2022 as part of its Make in India initiative, according to a new research. It means India is now the world’s second largest handset manufacturing market as pushes to become self-reliant with its growing manufacturing infrastructure.

A staggering 98% of all mobile phone shipments within the Indian market in 2022 were domestically produced and 16% of the production was exported, according to Hong Kong–headquartered market and research firm Counterpoint, compared to a mere 19% in 2014, the year Prime Minister Narendra Modi’s administration assumed office.

According to a report by the international research firm Counterpoint, India’s mobile phone shipments experienced a 23% compound annual growth rate (CAGR).

Increased demand, advancement of digital literacy, and strategic government backing have all contributed to this increase.

The government initiatives like the Phased Manufacturing Programme (PMP), Make in India, Production Linked Incentive (PLI), and Atma-Nirbhar Bharat have led to a surge in domestic mobile phone manufacturing in recent years.

Counterpoint’s Tarun Pathak, Research Director, reports that local manufacturing in the nation has significantly grown over the years to meet rising domestic demand.

In 2022, domestic production accounted for 98% of all mobile phone shipments from the country, a significant increase from 19% in 2014.

Pathak noted that businesses are establishing manufacturing facilities for components and mobile phones, boosting the country’s developing ecosystem. This trend has led to increased investments, job openings, and industry growth. The Indian government is now aiming to position the nation as a semiconductor manufacturing and export hub by implementing various initiatives.

Exports are also increasing as India exported 20% of the 250 million phones it produced in 2022.

Even though the domestic output in 2022 was 3% less than 2021, in value terms there is 34% increase due to people preferring premium phones and export of more premium units.

Apple accounted for 25% of the total value of locally made handsets in 2022, up from 12% in 2021. The company’s production volumes grew 65% on-year, while in value terms, it zoomed by 162% on year, Counterpoint said.

India produced around Rs 3.5 lakh crore worth of mobile phones in 2022, according to data shared by India Cellular and Electronics Association (ICEA). The industry body estimates that the country will produce Rs 4-4.25 lakh crore worth of handsets in 2023.

According to data shared by India Cellular and Electronics Association (ICEA), India produced 3.5 lakh crores worth of mobile phones in 2022 and the figure is set to rise to 4-4.4 lakh crores in 2023.

China remains the largest mobile manufacturing country, producing four times more volumes than India in 2022. At the same time, India produced 1.8 times more volumes than Vietnam, the third-largest producer of handsets, Counterpoint Research said.

But in export, India comes at third as India falls behind Vietnam where domestic consumption is very low compared to India.

“We have managed to achieve large scale, generate massive employment, build mega factories and create Indian champions… India emerged as the hub for electronics manufacturing,” said Sunil Vachani, executive chairman of Dixon Technologies, a leading electronics manufacturing services firm.

He said Dixon is now the largest Indian electronics manufacturing company, with a sales turnover of more than Rs 12,000 crore in FY23 and 21 plants employing more than 25,000 people.

Local manufacturing is only set to increase for smartphones, as India gears up to bridge the urban-rural digital divide and also become a mobile exporting powerhouse.

According to market research firm Canalys, India exported 13.5 million mobile phone units in the first quarter of 2023, and another 12 million units in the second quarter ended June.

In value terms, India exported $7.48 billion worth of mobile phones in January-June 2023, up from $2.9 billion a year earlier, according to data shared by ICEA exclusively with ET.