India wants to stop Chinese smartphone manufacturers from selling products for less than 12,000 rupees ($150) in an effort to revive its flagging domestic industry, which will hurt companies like Xiaomi Corp.
According to those with knowledge of the situation, the effort is intended to drive Chinese giants out of the lower end of the second-largest mobile market in the world. They claimed, asking not to be named because they were addressing a delicate subject, that it coincided with growing worries about high-volume companies like Realme and Transmission undercutting local manufacturers.
Before new entrants from the neighbouring country upset the industry with low-cost, feature-rich smartphones, domestic businesses like Lava and MicroMax made up just under half of India’s smartphone sales.
Apple Inc. and Samsung Electronics Co., whose phones cost more, shouldn’t be impacted by the change. Requests for comment from representatives of Xiaomi, Realme, and Transsion went unanswered. Inquiries from Bloomberg News went unanswered by the ministry of technology in India.
Chinese businesses operating in the nation, like Xiaomi and competitors Oppo and Vivo, have already been subject to intense financial scrutiny by New Delhi, which has resulted in tax demands and suspicions of money laundering. In the past, the authorities used clandestine methods to outlaw Huawei Technologies Co. and ZTE Corp. telecom equipment. Wireless providers are urged to buy alternatives even though there isn’t a formal regulation that forbids Chinese networking equipment.
Private requests from the government to Chinese executives to develop local supply chains, distribution networks, and export from India imply that New Delhi still values their investment, according to the sources.