Currently, smartphone connects more than 292 million users in our country and the ownership base is expected to increase 445 million in three years, a recent finding by Internet and Mobile Association Of India(IAMAI) reveals the statement. The smartphone shipments in India grew by 15 pc YoY in Q1 2017 in comparison to 11 pc growth in the global smartphone market. However, smartphone shipments in India crossed 30 million units in Q3 2016.
The study also says that more than 75 per cent of the Indian population still doesn’t carry a smart phone.
The IAMAI’s report on ‘Indian Mobile Phone Market: Emerging opportunities for accomplishing India’s digital economy dream’ underlines that, Government’s Digital India programme which aims to deliver digital inclusion, financial inclusion and government services through various mobile apps can be fulfilled only by high penetration of mobile network and low cost visibility of smartphones in the country.
The finding also underscores that Government’s recent implementation of Goods and Services Tax(GST) in July 1 this year had imposed 12 per cent for mobile phones which is expected to make most of the mobile phones costlier by 4 to 5 per cent . As per Indian Cellular Association (ICA), 30 out of 36 jurisdictions will have tax on mobile phones nearly doubling to 12 per cent leading to an increase in the price of mobile phones.
Giving an initial positive response to the Make In India campaign, the Government in Union Budget 2015-16 announced differential excise duty structure for mobile phones which gave domestic manufacturers cost benefit of about 11 per cent over imported phones. Further, a Special Additional Duty(SAD) was levied of 2 per cent on printed Circuit Boards(PCBs) in the Union Budget 2017-18 to drive long term commitment from mobile phone manufacturers, the study underlines.
Additional Secretary, Ministry of Electronics and Information Technology Dr Ajay Kumar who had released the IAMAI report pointed out, “As envisaged by the Government of India, the country is eying an increase in the turnover of its digital and Information Technology industry to 1 trillion US dollar by 2024-25 from a value of 413 billiob US dollar in FY 2016-17. Besides, today the rapid adoption of internet is being driven by phenomenal growth of mobile internet users which has increased in India by more than two times in the last three years from 137 million users in June 2014 to 420 million users in June this year.”
“As for domestic manufacturing, the overall localization rate for smartphones in last year stood at a low of 6.1 per cent, far below than China and Vietnam. The low level of local value addition is due to weak manufacturing eco-system which stems from limited capabilities across various processes of manufacturing value chain and resulting primarily in last mile assembly,” added Dr Kumar.