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Weak rupee to push up mobile phone prices

June 21, 2013 08:21 IST


Come July, mobile phone prices are expected to be dearer by up to 10 per cent due to the steep depreciation in the value of rupee against dollar.

"Brands dependent on import will have to take price increase of about 10 per cent due to decline in value of Rupee. Companies making mobile phone in India will be impacted to lesser extent but they will also have to increase price by 5 to 6 per cent," Indian Cellular Association's (ICA) National President, Pankaj Mohindroo told PTI.

The rupee hit a life time low of 59.93 to a dollar in early trade today before closing at 59.57.

"We have no other option but to increase the price. In the next couple of days, we will be increasing the handset prices by around 10 per cent," Lava International Co-founder and Director SN Rai said.

Though Nokia did not offer any comment, Samsung said that it has not made any change in the price of handsets yet and "holding onto the price lines for the moment." Mohindroo said that "price hike in products will be visible from July. 

Multinational brand Lenovo said that it may raise its mobile handsets prices in the range of 5 to 8 per cent.

"We are looking at the price situation and we would have to raise the price in the coming weeks. The hike could be in the range of 5-8 per cent," Lenovo India MD Amar Babu said.

Most of the Indian brands like Micromax, Lava Mobiles, Karbonn sell imported handsets at relatively low price.

Micromax expressed disappointment on the continuous decline in value of rupee and said "we are carefully monitoring the situation and are hopefully expectant of the trend to reverse, however if not, like the fuel prices, the device costs will also have to undergo price correction."

Datawind, maker of cheapest tablet PC Aakash, said fall of the Rupee will have direct impact on the price of tablets.

"We have seen a 30 per cent loss in the Rupee's value from 44 to almost 60 in the last 24 months. This gets reflected directly in price increases to the consumer, reducing affordability for the masses," Datawind CEO Suneet Singh Tuli said.

Like Lenovo, international brands like BlackBerry, HTC, Lenovo, Panasonic also import handsets from their units abroad to sell in India but no inputs were received from these firms.

"We are watching the situation...we are yet to take a position on pricing," HTC Country head Faisal Siddiqui said.  Retailers also admitted that the price of IT and electronic goods, including mobile phone, will go up soon.

"Fall of rupee will have an adverse impact on the electronic goods and IT products market. We see a likely increase in prices by about 5 to 10 per cent in the coming weeks and this will have a direct hit on the consumer’s pocket," House of Technology's Director Vipul Jain said.

Mohindroo said that the only long terms solution to respond to declining rupee for India is "to develop indigenous Electronic System Design and Manufacturing industry and value addition should be done in India." 

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