Xiaomi is teaming up with famous Apple supplier Foxconn to roll out the first smartphone made in India - the Redmi 2 Prime.
Foxconn has been assembling the Redmi 2 Prime from a plant in South India, helping Xiaomi produce locally, reduce delivery times and boost margins. The new partnership will also help Xiaomi lower costs and obtain a larger share of the world's third-largest smartphone market.
At the same time, the move is also a significant milestone in India Prime Minister Narendra Modi's "Make in India" initiative, which aims to turn the country into a manufacturing powerhouse. Separately, Foxconn also announced recently that it plans to pour $5 billion in an electronics manufacturing facility in India.
So far, there have been limited possibilities to manufacture smartphones in India, mainly because the country lacks a good infrastructure and a solid network of suppliers. For these reasons, the vast majority of phone companies in India, i.e. more than 100, were left to source their products from China and Taiwan.
Xiaomi, for its part, saw great success in China, but it's also shaping up as an important player in India. The company entered the Indian market back in June 2014 and the country rapidly became Xiaomi's second-biggest market. Xiaomi made a name for itself due to its affordable, feature-rich handsets, which stuck a cord in the Indian market.
An assembly line in India's southern Andhra Pradesh state starts rolling out Xiaomi's first made-in-India smartphone, the Redmi 2 Prime, on Monday, Aug. 10.
Xiaomi announced the news at a special event in Vizag, where Chandrababu Naidu, Chief Minister of Andhra Pradesh, launched the Redmi 2 Prime.
"Redmi 2 Prime is the first smartphone from Xiaomi to be assembled in our facility in Sri City. We would like to thank Andhra Pradesh government for helping us to start local manufacturing within just six months. Initial talks started in February and today we have already started to sell the Redmi 2 Prime," touts Hugo Barra, Vice President of Xiaomi Global.
For the time being, all of the smartphone's parts come from China, while the Sri City facility is in charge of assembly. Nevertheless, in the near future Xiaomi plans to source the components locally rather than importing them from China.
Manu Kumar Jain, Head of Xiaomi India, explains that the company will keep importing parts from China for a while, but will soon try to do its smartphones' packaging locally.
"This might be followed by getting chargers and batteries for Mi smartphones from local vendors," adds the executive.
Xiaomi initially plans to manufacture smartphones in India to cater to local demand in the country, not export those smartphones in other parts of the world.
As for the smartphone, the Redmi 2 Prime may not be the highest end flagship out there, but it nonetheless boasts good specifications for its price and category. Coming in at INR 6,999 (roughly $110), the handset features a 4.7-inch IPS HD display, a 64-bit Qualcomm Snapdragon 410 processor, 2 GB of RAM, an 8-megapixel rear camera and 4G Dual SIM support, among the highlights.
