Samsung had big plans for India, from rolling out the M series for the subcontinent to establishing the world’s biggest smartphone factory in Noida. They must have realized the capability of the Indian market and expected support from the government. It appears as though the latter has been yanked away from them because of a change in the Make in India program for for smartphone manufacturing industries.
Samsung has informed the government that it will reduce the number of phones manufactured in India, cease production of flagships and cease exports. The Phased Manufacturing Program (PMP) under the Make in India initiative was started to promote local production of phones and components. The prior due date to start making display panels was March 2020, which has now been pulled back to February of this current year. Organizations are campaigning against this move as India still does not have the necessary capabilities and foundation to produce the display panels required for these phones. Failure to consent to this schedule will result in Samsung confronting an additional 10-11% import duty on these components. Screens are a major part of the total Bill of Materials for Samsung devices, which is understandable considering that they are termed as the best on the planet.
Samsung’s future production roadmap demonstrated that they should be able to produce these locally by April of 2020, with an upcoming facility costing near $100 million (INR 700 cr). In the event that the Make in India imitative adheres to its plan requiring the production begin next month, Samsung will stop the manufacturing of flagships like the S9 and the Note9 as they would get too excessive because of the additional import costs. Manufacturing of cheaper phones will likewise be reduced.
Samsung has already curtailed the production of TVs in India, and they are currently imported from Vietnam. If the PMP does not get pushed back, get ready for more expensive Samsung products and lesser indigenous production. This will likewise impact India’s reliance on Chinese imports, which is precisely what the Make in India program was started to tackle. Taking into account how much business and employment Samsung and other manufacturers will generate in the coming years, some more support from the government is definitely not a wrong expectation.