Xiaomi keeps surprising the tech community, time and again. This time, the Chinese smartphone colossus, has entered into a partnership with Padget Electronics, a subsidiary of Dixon Technologies. Although Xiaomi downplayed the news, describing it as merely “a continuation,” there’s more to it than meets the eye.
Padget Electronics will be one of five contract manufacturers Xiaomi has in the country
The deal struck between the two companies centers around Padget Electronics assembling Xiaomi smartphones in its facility located in Noida, Uttar Pradesh. While this deepens Xiaomi’s roots in Indian soil, it also lends credence to the Indian government’s ambitious ‘Make in India’ initiative. Atul B Lall, Dixon’s vice-chairman, hailed the partnership as a “major milestone” for the project aimed at bolstering domestic manufacturing.
So why is Xiaomi so modest about the new deal? The reason lies in Xiaomi’s already substantial Indian operations. Padget Electronics is but one of five contract manufacturers the company has in the country. The alliance, then, isn’t a game-changer but rather a calculated move to reinforce its standing in what is the world’s second-largest smartphone market. Xiaomi currently holds about 15% of India’s smartphone market, trailing behind Samsung and Vivo.
Another layer to this story is the wider shift of electronics brands looking to spread their manufacturing wings outside of China. India’s incentive schemes to promote local manufacturing have been successful in drawing international players like Xiaomi and Apple. Padget itself has received grants from a government program that aims to ramp up telecom and networking product manufacturing.
While both Xiaomi and Padget benefit from this deal, the real winner could be the ‘Make in India’ program. With each such partnership, India strengthens its position as a global manufacturing player, even as it negotiates the complex terrains of royalty payments and foreign investments. Is this new deal a monumental shift? Not really. But it’s another solid step for both Xiaomi and India’s evolving role in global tech manufacturing.
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(Via)
