How badly will Indian smartphone manufacturing be hit by the lockdown?

How badly will Indian smartphone manufacturing be hit by the lockdown?

Last year’s Indian gains in global smartphone production due to the US-China trade war could be lost thanks to the coronavirus lockdown.

In fact, local press reports estimate that the present production halt in smartphone factories could put India four years back from its current share in global production, which had risen sharply in recent years, owing to the government’s focus on local manufacturing.

The statistics make impressive reading. India’s share jumped to 16 per cent in 2019 from nine per cent in 2016 thanks to handset makers moving production out of China, along with financial incentives by the Indian government.

These gains could, however, be lost if 2020 sees India’s share return to 2016 levels. Export losses could be covered by spare capacity, but whether local Indian demand will make up the difference is unlikely.

One research agency has cut its estimate of India’s 2020 smartphone production forecast by seven or eight per cent from the 300 million units expected before the lockdown.

Meanwhile, of course, China’s economy is now moving back towards some semblance of normality and its smartphone factories are ramping up production aggressively.

India, on the other hand, is having to endure a production shutdown during the 21-day lockdown, with no clear idea of whether the lockdown will actually end after three weeks.

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