Samsung Electronics Co, the South Korean maker of Galaxy phones, said it is opening the world’s largest mobile phone manufacturing facility on the outskirts of the Indian capital, as smartphone demand surges.
The factory will be inaugurated by Indian Prime Minister Narendra Modi and South Korean President Moon Jae-in at 5pm local time. Both leaders are visiting the facility adjoining New Delhi, according to India’s ministry of external affairs.
“The opportunity is just massive,” said Faisal Kawoosa, who heads new initiatives at researcher CMR Pvt. “Such a large facility will help Samsung cater to the huge demand in a country of 1.3 billion people where there are only 425 million smartphone users.”
Since taking power in 2014, Modi has pushed his “Make in India” initiative, which encourages companies to set up plants in the country, as the nation attempts to bolster domestic manufacturing. India attracted the highest ever foreign direct investment in the past year with inflows totalling US$62bil .
The new Samsung factory will have the capacity to fabricate 120 million smartphones per year, and make everything from low-end smartphones that cost under US$100 to the company’s flagship S9 model, according to the company.
Indians favour low-end smartphones priced at US$250 or less, given the low average annual income of its people, according to Bloomberg Intelligence. That’s one reason why Apple Inc has struggled to gain market share in India, with most iPhone models priced beyond US$500 according to a Bloomberg Intelligence report earlier this month.
Last year, India overtook the US last year to become the world’s second-largest smartphone market after China. There will be 780 million connected smartphones in 2021, compared with 359 million in 2016, according to a study by Cisco Systems. — Bloomberg