In an indication that demand is slowing in the device and smartphone market, the import of components fell 15-20 per cent in October.
According to data shared by a global technology market research firm, all smartphone brands reduced the import of components to India drastically during October.
Only two brands, Apple as well as Indian smartphone brand Lava, maintained steady import levels for components in October. The majority of brands import smartphone components in order to fulfil local demand.
“All brands do it now, except Google and some high-end phones of few brands. Most brands are assembling phones in India,” Faisal Kawoosa, Chief Analyst at Tech Arc, explained.
Therefore, the reduction in the import of components, especially in the month of October when the Indian festive season was in full swing is a cause of worry for most device-makers.
Most PLI beneficiaries — Samsung, Micromax, Wistron — have reduced their import of components as well. Lava was the sole PLI beneficiary to increase its component imports in October.
Since smartphone assembly for export purposes makes a very small percentage of smartphone assembly that takes place in India, it is still unknown what impact the drastic reduction will have on the overall number of smartphones exported from India.
Declining smartphone demand
These numbers are in line with the overall trend, wherein the Indian smartphone market has been declining for the past year. According to a recent IDC report smartphone shipments declined 10 per cent in the July-September period, at a three-year low, indicating waning consumer demand.
Globally as well, smartphone sales have declined 4 per cent in 2022. Smartphone sales picked up significantly in 2021, in order to fulfill the pent-up demand that arose after the pandemic. Given that economic pressures continue to mount and inflation bites the consumer’s pocket, demand for smartphones has seen a decline.