Comments
Domestic mobile handset manufacturer Lava plans to double its production capacity in India at an investment of ₹2,615 crore.
“We are currently doing 2 million units a month. We will double this in three-four months. Globally, we manufacture 40 million handsets a year (including at Lava's factories in China), out of which 24 million will soon happen in India,” Lava Chairman Hari Om Rai told BusinessLine .
The cost of labour has tripled in China over the past few years, giving India an edge, he said. “China has lost the competitive edge in low-end manufacturing. People (there) have enough opportunity to do high-level jobs instead of ‘labour’ jobs. Therefore, the cost of labour has gone so high that it is three times cheaper to manufacture in India,” Rai said.
Lava started manufacturing in India about nine months ago and, according to Rai, the company has not only seen lower production costs here but also substantial improvement in quality and efficiency.
It already has a manufacturing facility in Noida and will open another in the same place in three months. The company has acquired 50 acres of land in UP and 20 acres in Tirupathi. Rai said based on how conversations with governments in different States go, Lava could also look at setting up manufacturing in Maharashtra.
“We are envisaging 18 million phones every month in India in 10 years. Over the decade, we as an industry can do a $300-billion business employing about 2 crore people in the India. Right now, in the manufacturing segment, India employs about 30,000 people,” he said.
At present, most of the mobile manufacturing done in India revolves around assembly. Rai feels this is the segment where India’s low labour cost can help and also add to employment.
“We’ve seen that our Indian factories are able to produce 50 per cent quality improvement as compared to China. We are now looking at India to not just manufacture for the local market but also for exports to countries such as Thailand, Sri Lanka, Dubai,” said Rai.
Lava in India employs about 4,000 people in manufacturing and about 8,000-10,000 people on the field.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.