In order to become a global manufacturing hub, India needs to compete with other manufacturing hubs such as Vietnam and China -- preferred by investors due to their attractive and stable export-oriented policies coupled with better infrastructure and logistics network, says Manu Jain, Vice President, Xiaomi and Managing Director, Xiaomi India. The Chinese smartphone maker has initiated a small export pilot to Bangladesh and Nepal for smartphones from India.
"We have requested the government to make India a more export-friendly destination," Jain told IANS in an interview.
According to him, few initiatives will work in favour of this initiative such as duty drawback refund for the merchant exporter.
"We should also invest in laboratories which allow for global standard testing, since BIS is not a globally accepted standard," Jain added.
India has a lot to learn from Vietnam in terms of incentivising domestic manufacturing.
The government has announced the "remission of duties or taxes on export products" (RoDTEP) that would replace the existing Merchandise Exports from India Schemes (MEIS), which is not compliant with the world trade rules.
But the fog around RoDTEP still needs to be cleared.
According to Jain, with more government incentives, Xiaomi can fast scale up exports.
"We have a production capacity of three smartphones per second during operational hours. Currently, we are operating at 100 percent capacity. The capacity keeps expanding to meet the increasing demand of our products," he said.
Xiaomi currently has seven smartphone manufacturing plants in India in partnership with Taiwanese multinational electronics company Foxconn and Singapore-based technological manufacturer Flex.
Out of the seven plants, four are located in Sri City, Andhra Pradesh, two in Tamil Nadu and one in Noida. More than 99 percent of smartphones that are sold in India are manufactured locally.
"We started manufacturing locally in 2015 with one plant and expanded to two units in 2017 and seven units in 2018. Across these seven plants, we have employed more than 25,000 people. Out of these, 95 percent are women," Jain told IANS.
Xiaomi also locally sources and assembles PCBA (Printed Circuit Board Assembly) in India. In addition, even smartphone chargers, USB cables and batteries are nearly 100 percent locally sourced.
"We have also invested in setting up smart TV manufacturing plant in partnership with Dixon Technologies in Tirupati, Andhra Pradesh. Over 85 percent of the Mi TVs sold in India are currently locally manufactured," informed Jain, adding that the company is striving towards establishing a component manufacturing local sourcing network in India for smartphones.
Xiaomi entered Indian market in July 2014. It has just been five years that "we have entered the Indian market and have received an overwhelming response from our Mi Fans".
Xiaomi's vision, he said, has been to deliver innovation to everyone with an aim to provide high-end and technologically advanced products at honest prices to the masses in India.