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HomeTechGovernment to Chinese smartphone makers: Do these three things ‘right’

Government to Chinese smartphone makers: Do these three things ‘right’

Almost all leading

Chinese smartphone companies

have been under intense scrutiny in India over the last few years. Some are also facing allegations such as customs duty and

income tax

evasion apart from money laundering.
According to a report in Economic Times,

Vivo

and

Oppo

are now appointing Indian distributors in each state as the primary source of product supply to help resolve a long-standing point of conflict with the government.

As per the report, the decision to appoint Indian distributors is among the three key things that the government wants Chinese companies to do. So if you wondering what exactly are these three things in detail, here’s what they are:
Indianise senior management
First and foremost is that the government wants Chinese

smartphone

brands to have an Indian management. The key executives running the show need to be Indians.

Appoint Indian distributors
Second is to have Indian distributors. The aim here is to localise the

distribution structure

in India. As per the ET report, “until now, the brands had one or two Chinese-owned and managed distribution companies in each state, referred to as agents. They would in turn channel goods to retailers through local distributors. From next month, Vivo will scrap its agents in Delhi, Punjab and Haryana, having put in place Indian distributors for these states.” The company is expected to expand this model to other states. Oppo too has set up such a structure in Delhi as a pilot, replacing its Chinese distributor with an Indian one. This will be rolled out nationally. Other Chinese smartphone brands such as

Xiaomi

and

Realme

have been using Indian entities for distribution from the very beginning.
Use local contract manufacturers
The government has also reportedly repeatedly asked Chinese smartphone companies to use local contract manufacturers. Oppo, Vivo and Realme have started, or are said to be in the process of starting, smartphone manufacturing with Indian contract manufacturers such as Dixon Technologies and Karbonn Group as per a recent ET report.