India To Stop Cellphone Imports By 2007?

According to the Minister of Communication, Dayanidhi Maran, India may block imports of cell phones as early as 2007. The major vendors have all been preparing for this by establishing factories in India. For example, LG is in Pune, Samsung’s factory opened four months ago, and Nokia’s factory in Chennai helps Nokia retain about 50% of domestic market share. The article, in the Telecoms Korea paper, suggests India is being used by OEMs as a second export base after China to mitigate the risk of using only Chinese factories. No surprise, however, that the two population and growth giants of the world seem to be able to attract the multi-national vendors. But shouldn’t the attraction be purely economic and not regulatory? Many companies would choose to build in India whether they make it law or not. By using trade embargoes, these governments limit access to their domestic markets as extortion for the placement of factories and capital. The Telecom Korea site is subscriber only, but you can read a host of good observations on India’s mobile telecom sector by the same author, Uday Lal Pai, in this article.

BTW, don't bother trying to "surprise me" that the country in which I live also plays dirty pool when it comes to trade. It was ironic to watch Cheney go to Russia and try to tell Putin he shouldn't mess with the oil markets. The bigger you are, the more you can get away with. Power corrupts....

Yet these trade barriers seem somewhat shameless in the Indian and Chinese cases. Not even the USA is so brazen as to say, "Put your factory here, or you can't sell in this country."

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