Mobile production to reach 107 million units by 2011

New Delhi, Aug 30 (UNI) Mobile phone production in India is expected to reach 107 million units by 2011 from 31 million units last year registering an annual growth rate of 28.3 per cent, according to research firm Gartner.

The firm also said mobile phone production revenue will touch 13.6 billion dollars during the period from 4.9 billion last year.

''The growth in production will be driven mainly by the expanding mobile subscriber base in India and favourable government policies promoting local electronics manufacturing,'' Gartner said.

Presently mobile phone production in the country is dominated by the top five global handset vendors including Nokia, Motorola, Samsung, Sony Ericsson and LG.

There are very few local-brand mobile phone makers with low production volumes and are typically focused on low-end and mid-range handsets. However, Gartner expects new players -- local as well as global -- to enter the mobile phone manufacturing market, aided by the global electronics manufacturing services (EMS) providers' present in India.

''Existing global handset vendors as well as new entrants will outsource their production to EMS vendors to reduce 'time to market' and achieve faster penetration for their own branded handsets,'' Ganesh Ramamoorthy principal research analyst Gartner said.

This will raise EMS vendors' share of total mobile phone production in India to nearly 40 per cent by 2011, he added.

Though domestic mobile phone production currently caters mainly to local demand, over the next five years as much as 30 per cent of production to be exported to neighbouring regions that are also demanding low-cost handsets such as Africa, the West Asia and other parts of South Asia, the research firm added.

''India faces a key challenge as it lacks a mature component supply base to support local mobile phone manufacturing, Mr Ramamoorthy said.

''India's production of vital components for mobile phones is very limited because much of it is imported. This may not be viable in the long term, especially with demand for handsets expected to grow rapidly. Therefore, establishing a reliable component supply base will be vital for the Indian handset manufacturing industry to stay competitive in both the domestic market and the export market,'' Mr Ramamoorthy added.

UNI