Smartphone production in Bangladesh grew by 27.58% in the first nine months of the year. Over 6.5 million units were produced between January and September, up from 5.1 million in the same period in 2023, according to the Bangladesh Telecommunication Regulatory Commission (BTRC). In September alone, 912,000 smartphones were locally manufactured or assembled, marking the second-highest production month of the year, just behind February’s 925,000 units.
Production dropped to 562,000 units in June before gradually recovering. More than a dozen brands now manufacture or assemble smartphones in Bangladesh. However, the year has been challenging for manufacturers due to the foreign currency crisis, said Ziauddin Chowdhury, country manager for Xiaomi Bangladesh, which meets 18% to 20% of the country’s annual smartphone demand. He noted that high inflation has subdued market demand, even as companies build inventory to prepare for future sales.
During the COVID-19 pandemic, around 12 million smartphones were sold in Bangladesh’s formal market, with local factories covering about 90% of demand. Rising prices and reduced disposable income have since lowered demand to below 10 million units, though local production now meets around 95% of the formal market’s needs.
“Importing raw materials has become easier this year, and demand for affordable smartphones has grown about 10% year-on-year,” said Rezwanul Hoque, CEO of Ismartu Technology BD, which leads the market with its brands Techno, Infinix, and Itel, holding a 38% share. Both Hoque and Chowdhury voiced concerns over grey market imports. They estimate that 3 to 4 million refurbished, unofficial, or used smartphones are sold annually, comprising nearly 40% of the total demand.
Feature phone production also rose significantly, with 14.4 million units produced from January to September, up from 11.3 million in the same period last year. Formal smartphone imports more than tripled to over 66,000 units, with 5G devices comprising over 25,000 units.
Imported smartphones in Bangladesh are subject to a combined 57% in taxes and duties, while locally manufactured phones face only 20% to 25% in taxes. This advantage has further encouraged domestic production.
Despite recent challenges, Bangladesh’s smartphone market shows promising growth potential. According to Hoque, only about 40% of the country’s 130 million mobile users currently own a smartphone. Chowdhury added that two-thirds of smartphones in the formal market are priced under Tk20,000. Phones above Tk30,000 account for only 2% of local annual sales.
Source: The Business Standard
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