Xiaomi ties up with Foxconn to make smartphones in India

“We have always said India is a key market for us”.

The lack of complete infrastructure in terms of component manufacturing has been one of the major hurdles for manufacturing in India.

A tweet by Naidu said he will be launching Xiaomi’s “first India manufactured phone tomorrow (Monday) in Visakhapatnam”.

For Xiaomi, “the benefits are clear” for making in India, Hugo Barra, the company’s vice president in charge of global operations, said. Xiaomi seems to have marked all of those on its check list to popularity in India.

N Chandrababu Naidu, chief minister for Andhra Pradesh, hailed Xiaomi’s arrival on Twitter with photos of the launch event.

The facility being built in India is very similar to one that Xiaomi built in Brazil, which was also created in partnership with Foxconn. With current government in India trying hard to promote the country as an investment and manufacturing destination, we can expect more such deals in near future.

Still, rising labor costs in China are causing manufacturers to send feelers into other markets, and India is set to become the world’s second-largest market for smartphones in the next several years, surpassing the United States.

Talking about the role of the Andhra Pradesh government, Barra said the team functioned “like a startup”.

If we had to guess, it would be that Xiaomi will announce their local manufacturing in India in the city of Vishakhapatnam. “To manufacture the phone in India, the whole ecosystem would have to exist here”. Only big electronic manufacturers in India are Samsung and LG. Xiaomi recently started making phones in Brazil, another large developing country.

Xiaomi, which has already sold over three million handsets in the country so far, looks to gain a fair share of the budget smartphone market.

The worldwide Monetary Fund (IMF) in its recent forecast said China’s economy will slow down to 6.8 per cent this year followed by 6.3 per cent in 2016 and six per cent for 2017.

Unsurprisingly perhaps, the Xiaomi Redmi 2 Prime price in India has been confirmed at Rs.

Xiaomi is set to be the first of many companies to make an entrance into the Indian market, which is soon expected to be booming.

If Foxconn follows through on its $5 billion investment plan, more of its clients may have their phones produced in India. With majority of a billion people still to get on the Internet which require smartphones, India provides a massive opportunity.