HMD Global in talks to use more components made in India in Nokia smartphones
With the economic rise of China and other East-Asian nations, the old Nokia about 10 years ago had big problems, because a lot of manufacturing facilities of Nokia phones were based in Europe. The huge part of electronics manufacturing globally has already moved to China, and that led to the rise of Chinese smartphone maker that could offer the same or sometimes better devices on paper for the lesser price around the globe.
India, as a natural competitor to China, also started implementing programs to safeguard their economy from the influence of China. One aspect of that is manufacturing of mobile phones, were India is trying to force manufacturers (via duties, taxes, tax breaks, etc.) to move as much of the supply chain and assembly to India.
HMD Global, the marker of Nokia phones, already makes all their phones available on the Indian market in India. But what does “make in India” mean? Well, mostly assembly of imported components from China. As Counterpoint Research points out, India imported $13 billion worth of mobile phone components in 2018. The local manufacturing of some parts and local assembly still adds value to Indian economy and brings the prices of phones down compared if they were imported, but more locally manufactured components is the goal. That means companies that make displays, and other components have to move to India, not just the phone manufacturers.
That’s why HMD Global, according to Economic Times, is finalising the plans of increasing the sourcing of components from local origin in India. Meaning, less parts imported from China, Vietnam or Indonesia, which brings the cost of phones down, allows a device to be faster out on the market and, I hope, will make components locally more available for repairs.
HMD Global isn’t the only company struggling and trying to improve their manufacturing capabilities in India. As Counterpoint points out, Reliance Jio imported 40% of their Jio Phones in 2018, with other companies facing similar challenges. Moving the supply chain is a long-term process, and that could also be the reason Indian authorities will likely postpone the duties on touchscreens and other components (you can check in the table above) that were supposed to be implemented this or next year.
