India may pip China, Vietnam to become mobile export hub: Report

India may soon pip China and Vietnam to become a mobile export hub as Apple, Samsung and domestic players such as Lava Group are planning to ramp up manufacturing in the country, according to a report by Business Standard.

According to the report, five global and five Indian players (Lava, Micromax, Padget, UTL Neolnycs and Optiemus) have made a commitment to produce 12.5 lakh crore phones in five years under the government's Production Linked Incentive Scheme (PLI) scheme.

Under the PLI scheme, companies receive incentives ranging from 4-6 per cent of their production value to narrow the gap between the cost of manufacturing in India and that of China and Vietnam. To receive the incentive, the company has to meet the investment target and the value-of-phone-manufactured target each year.

The Modi government on Monday is said to have given them the green signal.

The 10 companies have also jointly committed that 60 per cent of the production value would come from exports.

Samsung has reportedly committed to manufacturing Rs 2.2 lakh crore worth of mobile devices. The devices are likely to be priced above Rs 15,000 so that it is eligible to export under the government's PLI scheme, sources told the publication.

In FY19, Samsung made over Rs 43,000 crore worth of mobile phones. According to the report, to reach the government’s expectation under the PLI scheme, it would have to export around Rs 1.32 lakh crore worth of phones in the next five years, or an average of over Rs 26,000 crore worth of devices per year.

Apple Inc’s three vendors — Foxconn Hon Hai, Wistron and Pegatron — are planning to invest an incremental Rs 3,000 crore in manufacturing, the report cited. Along with Rising Star (which currently manufactures for Xiaomi), it is committed to producing over Rs 6.8 lakh worth of mobile devices above the price tag of Rs 15,000 in five years, sources told the publication.

Similarly, Lava International is said to have made export commitments of Rs 1,100 crore in its first year, accounting for about 41 per cent of its total production value. It is said to ramp up the production gradually year-on-year to over Rs 7,000 crore in the fifth year, which will account for 60 per cent of its production value.