Almost all the phones that Chinese smartphone maker Xiaomi sells in India are made in the country, according to the top company executive here on Monday.
“About 99 per cent of the phones sold in India are made in the country. We make three phones per second,” said Muralikrishnan B, Chief Operating Officer (COO), Xiaomi India. Xiaomi smartphones were being exported to other countries too, though, at a small scale, he added.
Xiaomi phones in India are manufactured mainly by Taiwanese tech giant Foxconn, also known as Hon Hai Precision Industry Co, at two facilities — one at the Sri City special economic zone (SEZ) in Andhra Pradesh and the other at Sriperumbudur in Tamil Nadu.
Xiaomi also exports made-in-India phones to Bangladesh and Nepal. “We have started exporting to these two countries, but at a small scale. With more government incentives, we plan to scale up exports,” Muralikrishnan said.
“We will have to see if we can manage the entire logistics. Ultimately, we will have to realise that cost efficiency also matters,” he remarked.
The COO of India’s biggest smartphone seller said, there were issues, including certification and low duty drawbacks rate, hindering the export of its ‘make in India’ products.
“The BIS certification is not accepted in many parts of the world. If the government can make the BIS certification acceptable in neighbouring countries, it would help us scale up,” he said. India had a lot to learn from Vietnam in terms of incentivising domestic manufacturing, he added.
Better clarity on working of the proposed new scheme for reimbursing input duties and taxes would help, Muralikrishnan said.
The government had announced the ‘remission of duties or taxes on export products (RoDTEP)’ would replace the existing Merchandise Exports from India Schemes (MEIS), which is not compliant with world trade rules.
“The fog (around RoDTEP) needs to clear,” Muralikrishnan remarked.
Xiaomi said, 65 per cent components (in value terms) of Xiaomi phones were also sourced from within the country.
“In terms of manufacturing, the progress that India has made in the past five years is phenomenal,” said Foxconn India Country Manager Josh Foulger. Besides initiatives under ‘make in India’, corporate tax relief and improvement in ease of doing business had helped a lot, he added.
Significantly, all the operators at Foxconn’s Sri City facility for Xiaomi are women. The facility employs over 15,000 people.
Muralikrishnan said, Xiaomi was committed to designing products that suit Indian consumers. For example, it introduced water-repellent coating (P2i) to prevent damage due to high humidity in certain parts of the country.
“We observed that most complaints were coming during monsoon and were diagnosed with liquid damage. Thus, we introduced P2i,” he said and added, this coating was now applied to all Xiaomi phones in India.
It’s basically a nano-coating applied on the exterior and some interior parts to change the surface tension of the device. “P2i doesn’t make the phone waterproof, but splash resistant,” he said.
The customer satisfaction increased significantly after the phones were made splash resistant, Muralikrishnan said.
Similarly, the Redmi Note 8 introduced an auto-clean feature to clean the dust from the speaker with the help of sound wave.
“At Xiaomi, we are obsessed with quality. We believe in doing innovation for everyone. The best of specifications, the highest quality and the honest pricing are the three principles around which our products are built,” he said.