The government’s best efforts to boost manufacturing in the country notwithstanding, India’s production of telecom equipment has nearly halved since FY11. A separate report has mentioned that the exports of mobile phones from the country are estimated to be zero in 2015.

Handset production

The country manufactured total equipment worth ₹28,000 crore (estimated) in 2013-14, compared to ₹53,275 crore in 2010-11. The production has been declining for the past three years with the figures for 2011-12 at ₹32,000 crore and for 2012-13 at ₹29,500 crore, Minister of Communications and Technology Ravi Shankar Prasad informed Rajya Sabha. Production of mobile handsets fell to ₹10,000 in 2013-14 (₹12,000 crore in previous year) and line equipment to ₹4,000 crore (₹4,500 crore), while wireless equipment was flat at ₹8,000 crore. However, production of cable recorded an increase at ₹6,000 crore (₹5,000 crore).

In its bid to increase the share of domestically manufactured electronic products including telecom equipment, the Government had laid down a policy in February 2012. The policy stated the need for promoting indigenous R&D, an ecosystem for intellectual property rights creation and preference for domestically manufactured telecom gear.

However, the total consumption in India has been increasing since FY11, when it stood at ₹37,465 crore. In 2013-14, it rose to ₹1 lakh crore from ₹75,000 crore in 2012-13 and ₹50,000 crore in 2011-12, the minister said, answering a question in the upper house of Parliament last week. The total export of telecom equipment from India was almost flat during the last three years, while imports rose. India imported equipment worth ₹69,516 crore in 2013-14, as against ₹57,209 crore in 2012-13 and ₹55,467 crore in 2011-12.

While exports to China were more or less flat during these three years, import from there rose substantially. India imported equipment worth ₹43,690 crore in 2013-14, ₹35,863 crore in 2012-13 and 33,640 crore in 2011-2012.

A separate report submitted to the Indian government by industry body Indian Cellular Association (ICA) stated that mobile phone exports may crash to zero in 2015.

Indian mobile market grew 32 per cent to $12 billion in 2014 but imports occupy three quarters of market. Domestic productions fell by 29 per cent, ICA said. The association, which suggested steps to improve production in India, expects to bring mobile imports to zero by 2019.

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