Chinese cellphone makers are planning to localize their products for the Indian market, according to the 21^st Century Economic Report released on Wednesday.

In the Indian government's February's annual budget report, custom taxes for imported cellphone parts or accessories (such as adaptors, batteries, chargers, headphones and speakers) skyrocketed from zero to 29.44 percent. On the other hand, import taxes of printed circuit boards and the consumption tax rate for parts of mobile devices bought locally grew from zero to 2 percent.

Like Us on Facebook

The latest figures, according to China Daily, implies that India's local government wants to produce cellphone parts domestically. Despite the increase in taxes, a number of battery manufacturers are reportedly looking into the possibility of establishing and expanding factories in the country.

Following India's recent report, one battery supplier said that the country is tempting Chinese companies to localize their products. In fact, many mobile supply chain firms that have already set up factories and created merging and acquisition deals in India.

India is allegedly adjusting its trade policy to cater the manufacturing sector. Moreover, the county has presented a five-year-plan for the cellphone industry and is luring small-time mobile parts suppliers, Huang Hanzhou, general manager of a Shenzhen-based mobile supply chain management firm, said. Once the market becomes mature, bigger manufacturing firms are expected to come.

Huang further stressed that localizing products is preferred as the Indian government only charges one percent as import duty, granting firms have factories in the country.

Another Chinese mobile phone supplier has, however, pointed that opening factories in India can be risky, citing the country's lack of mature industrial cluster and the cost of developing domestically.

Tagschina, cellphone suppliers, mobile parts suppliers, India, indian market