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India is likely to ban Chinese companies from selling smartphones under Rs 12,000

The Indian government intends to prohibit Chinese-based smartphone players from selling low-end smartphones (less than Rs 12,000) in order to boost sales of homegrown brands such as Micromax, Lava, Karbonn, and others. Let’s learn more about it!

About the ban

According to people familiar with the matter, the move is intended to push Chinese conglomerates out of the lower segment of the world’s second-largest mobile market. It coincides with growing concern about high-volume brands such as Realme and Transsion undercutting local manufacturers, they said, declining to be identified because they were discussing a sensitive subject.

Source: Kalinga TV

Exclusion from India’s entry-level market would be detrimental to Xiaomi and its peers, who have increasingly relied on India to drive growth in recent years as their home market suffers from a series of Covid-19 lockdowns that have crippled consumption. According to market tracker Counterpoint, smartphones priced under $150 accounted for one-third of India’s sales volume for the quarter ending June 2022, with Chinese companies accounting for up to 80% of those shipments.

Xiaomi’s stock fell further in the final minutes of trading in Hong Kong on Monday. It fell 3.6%, bringing the year’s decline to more than 35%. According to the sources, it is unclear whether Prime Minister Narendra Modi’s government will announce any policies or use informal channels to express its preference for Chinese companies.

India has already taken a tough stance against Chinese manufacturers, as evidenced by recent raids on Chinese smartphone companies such as OPPO, Vivo, and Xiaomi. The Indian government is investigating allegations of tax evasion by three Chinese mobile companies: OPPO, Vivo India, and Xiaomi. The Directorate of Revenue Intelligence (DRI) served notices on OPPO India, Xiaomi India, and Vivo India for duty evasion, Finance Minister Nirmala Sitharaman told the Rajya Sabha last week.

Aside from smartphone companies, the Indian government is interested in Chinese apps. The government recently ordered Google and Apple to remove the Battlegrounds Mobile India (BGMI) app, also known as the Indian version of PUBG Mobile, from the Google Play and Apple App stores. In India, the BGMI mobile game is no longer available for download. Neither the government nor the game developer has revealed why the mobile game has been blocked in the country. This follows the Indian government’s 2020 ban on hundreds of Chinese apps, including TikTok, PUBG Mobile, and others.

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