ICA questions Samsung’s commitment to ‘make in India’


India’s handset market leader Samsung and industry body Indian Cellular Association (ICA) are involved in an ugly spat over each other’s agenda.

The ICA said it has suspended the Korean handset market from its membership, accusing it of following its own agenda at the cost of the country’s. Samsung, on its part, said it had chosen not to renew its membership of the association after December 31, 2017, and rejected ICA’s views, while underlining its commitment to Make in India.

“We have had some differences,” Pankaj Mohindroo, president of ICA, said in a statement to ET.

He said that Samsung had decided to put all its global manufacturing bets in Vietnam instead of India a few years back, at a time when local manufacturing was reviving under the Make in India campaign. “That was a big jolt”.

Mohindroo added that the association will support Samsung “on issues which are in the overall interest of the industry and the nation, but not on any agenda which singular profits one specific brand and not in the interest of the secular growth of the industry and the nation.”

Samsung countered, saying it was committed to the Indian market since 1995, and has made massive investments into local manufacturing to prove that, the latest one being of nearly Rs5000 crore to expand local manufacturing capacity. It added that the company will continue to invest in local R&D under its ‘Make for India’ initiative, adding that it makes all its phones, including the latest Galaxy S9, locally.

People familiar with the matter said the major bone contention was the handset major’s belief that ICA was pushing the agenda of Chinese handset companies – which had eaten into the market shares of Samsung and Indian handset companies – as opposed to being neutral to all. Chinese players such as Xiaomi, Oppo, Vivo and Lenovo have cornered over half of the Indian smartphone market. Xiaomi in fact has recently replaced Samsung as the No. 1 smartphone player in India.

ICA did not comment on this specifically, while Samsung did not share its views on this aspect of the ongoing discord.

Indian handset players like Micromax, Lava and Karbonn have also waded into the debate, without involving ICA, saying that there should be some support or protection for local players, in the same way that the Chinese government supports its local handset industry.