Government has set up a joint task force, which will include industry representatives from Samsung, Microsoft Devices and Lava, to rejuvenate nation’s mobile phone manufacturing ecosystem with a view to achieve production of 500 million units of mobile handsets by 2019. Also Read - Indian government levies 10% import duty on key smartphone components
Industry body Indian Cellular Association (ICA) National President Pankaj Mohindroo has been appointed as Chairman of the task force. Nokia SEZ President and Director – India Operations Josh Foulger has been made co-chairman along with Lava Co-Founder Hari Om Rai. Samsung India Managing Director BD Park, Sony India Kenichiro Hibi, Microsoft Devices Director for Government relations Sandeep Bhargava, LG India MD Soon H Kwon, Micromax Informatics Co-founder Vikas Jain are also on board as members of the task force. Also Read - India is now world's second largest mobile phone producer: ICA
The Department of Electronics and Information Technology (DEITY) Directors SK Marwah and Asha Nangia will represent government in this task force. In an office memorandum, DEITY has announced setting up of a ‘Fast Track task Force’ to “re-establish and catalyse significant growth in mobile handset and component manufacturing eco-system in India.” Also Read - Union Budget 2018: Imported phone prices may go up 3-4% after customs duty hike
As per the office memorandum, the terms of reference of the task force includes promotion of “large scale manufacturing/assembly activity to achieve production of 500 million units of mobile handsets by 2019 i.e. annual manufacturing output of Rs 150,000 crore to 300,000 crore.” It is estimated that this large scale production can create employment opportunity for 15 lakh people.
ICA in its budget recommendation has said that in absence of corrective measures, mobile exports from India will crash to zero in 2015. Mobile market in India is estimated to grown by 32 percent or to $12 billion in 2014 but imports account for three-quarters of the market. Domestic production fell by 29 percent in the year mainly due to suspension of production at Nokia plant. Finland-based Nokia sold its worldwide handset business for$ 7.2 billion to Microsoft, but its Sriperumbudur plant was left out of the deal due to tax issues faced by Nokia India. The factory, considered to be among the largest for the company, stopped production from November.
Exports of mobile phones have been declining after touching a peak level of Rs 12,000 crore in 2012. Mobile exports crashed by 70 per cent from Rs 11,850 crore in 2013 to Rs 2,450 crore in 2014. They are estimated to be nil next year in absence of corrective measures, an ICA report has said.