India Reportedly Considers Banning Budget Chinese Smartphones

india ban chinese china smartphones xiaomi

A new report claims that India might be looking into pushing Chinese brands out of its budget smartphone market. Specifically, the restriction would prevent smartphone makers from China from selling devices under IND12,000 (~RM672), which would undoubtedly affect brands such as Xiaomi and BBK Electronics-subsidiary realme.

India, which is the world’s second biggest mobile phone market, apparently wants to ban Chinese firms out of the lower segment due to concerns of high-volume companies such as realme and Transsion allegedly undercutting the country’s own local manufacturers. This came from anonymous sources, whom Bloomberg says are familiar with the matter.

india chinese china smartphone ban
Photo: Shivamjoker / Pixabay

Giants like Xiaomi heavily rely on India for its growth, as China itself is facing an economic downturn from frequent COVID-19 lockdowns. According to market tracker Counterpoint, smartphones under IND12,000 made up a third of India’s sales volume last quarter, with Chinese companies contributing to 80% of overall shipments.

Specifically with Xiaomi, it would be a significant blow as it controls about a quarter of the Indian budget segment, with 66% of its smartphones being under that price threshold. Bloomberg analysts estimate that if this restriction were to actually take place, Xiaomi stands to lose 11%-14% a year on smartphone shipments, equivalent to 20-25 million units.

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Prime Minister of India Narendra Modi (left) and President of China Xi Jinping (right). Photo: MEAphotogallery/Flickr

India has been putting Chinese tech firms under heavy scrutiny this year, putting out official investigations on the likes of ZTE and vivo for alleged financial improprieties, as well as over 500 other companies from China including Xiaomi, Oppo, Huawei, and Alibaba. Additionally, the South Asian country’s anti money-laundering agency also took control of Xiaomi’s Indian bank accounts for allegedly breaching foreign-exchange laws.

Casting back further, India had started banning dozens of Chinese apps from the country in 2020 under the guise of “emergency measures” following a dispute between the two countries over the Himalayan border. The ban includes popular apps such as TikTok and WeChat, with the list growing every few months to a total of over 300 apps today.

(Source: Bloomberg)

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