Why China and India are Key to Global Consumer Electronics Market

Click, touch or blink, technology through various gadgets and devices, is taking the world on a spin. Apple, Google, Microsoft, Facebook and IBM are some major brands dominating the global consumer electronics market. However these brands are headquartered in the U.S. and other countries. India has turned itself as the global basket of imports, as the markets in India feature mainly imported products. Ranked as the second most populous country globally, India is trying its level best to become one of the leading consumer of electronic goods globally.

Increasing prevalence of web carts online, have made shopping fun and easy for customers globally, however, it has adversely affected new brands cropping up in India. International brands dominate the global market and find great business in India, owing to increasing population. Furthermore, the country has become the global technical warehouse, as it has increasingly imported electronic products.

Every year, India produces around 20,000 tonnes of e-waste for people of the country, however, major part of production are witnessed to be incinerated and drained due to increasing preference of consumers for international brands. International companies manufacture electronic goods and flood the markets in India with their products at cheaper rates. Increasing preference and established loyalty for other international brands are leveraging them to gain dominance in the market thereby, posing threat and tough competition for national and local brands of India.

Customers in India tend to trust established brands over local brands and usually discard the idea of purchasing products once they know it is manufactured in India, which is a significant factor that have compelled the country to become a major consumer of electronic goods and has been tagged as manufacturer of E-waste.

Moreover, with emerging websites offering online products from international brands preferred by customers are not available in India, due to which demand for products manufactured outside the country increases as compared to products manufactured by local companies and brands affecting the economy adversely. International companies offer their products to online shopping portals and ship their stocks to India, which are witnessed setting trends in the markets or online shopping websites. Influx of international products in the markets of India has invaded the market space and scope available for local manufacturers.

Products offered by local brands are usually not preferred and discarded as they come in cheaper prices, with questionable quality as they do not last long. Mainly international companies venture India to underscore a strong market owing to increasing population.

Customer’s taste is another factor that has turned India into a technical import basket as products offered by local brands within the country are of inferior quality as compared to products offered by international companies, due to which customers develops the taste of buying products of higher quality and would prefer another brand only when they are offering a better product at similar or cheaper price with additional attributes.

Increasing consumption and influx of electronics products in India has turned into a technical warehouse for manufacturers of different countries. Furthermore, China has offered to expand its manufacturing facilities to India, of which India is expected to be the major consumer.

Post its market break down and stagnating economy, China has been struggling to revive and has extended its manufacturing facilities in order to offer products at a cheaper price. Trend of increasing consumption of global electronic goods and imports has adversely affected the micro, small and medium enterprises (MSMEs), as customers in India prefer purchasing products that strong brand awareness and good reviews. Another factor is that while many developed countries are running on a 5G network, India is still struggling to launch and offer 4G services. Products offered by developed countries are often accessorized with better features as compared to those offered by local brands.

Tracing footprints back to history, India was a major consumer of products manufactured in China, owing to cheaper prices and easy availability. However, since the consumer preference has shifted towards products offered by original brands and companies, the markets and economy of China has witnessed a sharp downfall.

For past few months this year, import of electronic goods such as smartphones, televisions, laptops and other electronic products have edged out import of bullion goods such as gold, pearl, machinery in India. Furthermore, the country features as the second-largest importer of oil and a major importer of electronic products.

The markets in India today crawl at the same pace as nearly half the market is supplied by the imports from markets outside the country. While the ruling government has launched schemes such as “Make in India” and “Digital India”, the markets in India have only progressed a little, to own the crown of “manufacturing hub”.

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