Smartphone exports top $2 billion in first 2 months of 2023

India’s mobile phone exports crossed $2 billion (over Rs 16,500 crore) in the first two months of 2023, driven mainly by Apple and Samsung, taking the total export value to over $9 billion since April 2022, as manufacturers stepped up production and outward shipments.

Smartphone exports in the April 2022-February 2023 period have doubled from the corresponding period a year ago, when exports hovered around $4.5 billion, according to industry body India Cellular and Electronics Association (ICEA) data exclusively made available to ET. Smartphone exports for the fiscal year ending March 31 is also expected to roughly double from $5.8 billion in the year before. According to the data, India’s smartphone makers are now clocking around $1 billion in exports every month from September 2022, primarily boosted by the production-linked incentive (PLI) schemes.

Apple and Samsung together contributed around 90% of total exports since April 2022, of which the iPhone-maker’s contract manufacturers — Foxconn Hon Hai, Wistron, and Pegatron — accounted for around 55% while Samsung made up for the remaining 35%. Besides Apple and Samsung, the rest of the exports came from merchants exporting specific handset models to other regions where there is a price arbitrage, ICEA said.

Contribution of exports
India-made devices are now being shipped to countries including the UK, the Netherlands, Austria, and Italy, said industry executives. Earlier, handsets were being exported mainly to the Middle East, Africa, and South America.

The ICEA data showed the contribution of exports is expected to jump to 24% of the total production in FY23, from 16% in FY22.

India is expected to manufacture around Rs 3.3 lakh crore ($40 billion) worth of smartphones in the current fiscal, up 20% on-year, of which roughly $10 billion worth of handsets will be exported, said Pankaj Mohindroo, chairman, ICEA.

"Efficacy and maturity of an industry is only judged with robust exports. Mobile phones policy and outreach initiatives have been relentless, and the results are in front of us," he said.

The industry body, which represents the likes of Apple, Xiaomi, Foxconn, Lava, and other smartphone makers, said work is on to deepen the electronics manufacturing ecosystem to increase the domestic value addition. Local value addition by end of this financial year is expected at around 25%, as per an ICEA and ICRIER report.

Apple’s contract manufacturers and Samsung are part of the government’s Rs 38,000-crore PLI scheme for mobile manufacturing, which was formed to wean electronics manufacturing away from China by giving global as well as local players a push to make India a hub for mobile manufacturing.

Hon Hai and Wistron has already received the sops from the government for meeting the incremental targets last year. Foxconn got Rs 357.17 crore while Wistron received Rs 601.93 crore from the government as part of the 6% incentive for the first year of the scheme.

Pegatron started manufacturing from April 2022 and will be claiming benefits this year.

Samsung has its largest manufacturing unit in Uttar Pradesh, where it makes almost all the models it sells in India and globally, including its premium foldable smartphones.

The Korean smartphone brand was the only one to meet the incremental targets in 2020, the first year of the scheme.

The smartphone PLI scheme’s success has prompted the government to launch similar schemes in 14 sectors, such as automobile and auto components, IT hardware, telecom equipment and design, pharmaceuticals, solar modules, metals and mining, textiles and apparel, white goods, drones and advanced chemistry cell batteries.