Oppo nonetheless chose to raise investment and strengthen the Indian manufacturing ecosystem despite the increasing scrutiny the Indian government has directed at Chinese smartphone manufacturers.
According to the Economic Times and Canindia News, Oppo announced the Vihaan project in India and will invest US$60 million over the next five years to strengthen the local supply chain, empower micro, small, and medium enterprises, and encourage the establishment of about 30 Tier-1 suppliers in an effort to increase Oppo’s local export capacity to US$5 billion.
Additionally, Oppo will concentrate on creating cutting-edge technologies like 5G and AI to quicken the product development cycle in India.
The appropriate time has come to encourage the export of Oppo’s made-in-India smartphones to targeted countries, according to Vivek Vasishtha, vice president of public relations at Oppo India. This is because a strong local supply chain is starting to take shape. Prior to the Vihaan project, Oppo invested INR24 billion (US$3.03 million) on the construction of a sizable plant in Greater Noida, Uttar Pradesh, and opened its first 5G research lab outside of China in Hyderabad.
According to sources cited by Bloomberg in March, Xiaomi, Oppo, and Vivo are in talks with contract manufacturers in India who are eligible for the mobile phone manufacturing incentive scheme in an effort to increase their export capacity and benefit from the financial incentives offered to domestic companies. While Xiaomi is pursuing Dixon Technologies, Oppo and Vivo are in discussions with Lava International.
India, the world’s second-largest producer of mobile phones, was only placed 10th globally in terms of mobile phone export values in 2021, with a substantial percentage of its capacity being used to satisfy domestic demand, according to Trademap statistics. However, as a result of the shift of the global supply chain in recent years, an increasing number of businesses, like Apple, are diversifying their supply chains in order to increase supply chain resilience, with India as one of their top goals.
Conversely, Chinese smartphone producers currently face significant regulatory obstacles in India. India demanded that Xiaomi pay INR6.53 billion in import taxes that Xiaomi had been found to have avoided in January. India frozen many Vivo accounts in July over allegations of tax cheating, while it raided Oppo over allegations of INR43.89 billion in customs duty evasion. It’s important to note that the person who spoke about the Vihaan initiative was Oppo India’s vice president of public affairs.
According to Canalys’ most recent smartphone market tracker, the second quarter saw a decline in demand and increased regulatory inspection of Chinese manufacturers.
Exports of mobile phones by country’s value, in US dollars