China's ZTE plans to enter booming Indian phone mkt

By siliconindia staff writer   |   Friday, 19 March 2004, 08:00 Hrs
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NEW DELHI: Zhongxing Telecom Co Ltd (ZTE), China's second largest telecoms gear maker, plans to enter India's saturated, but growing, mobile handset market this year with about a dozen models, a company official said on Thursday.
"We expect to sell more than two million units each year and are aiming at roughly a 10 per cent share of the market," vice-president of ZTE Fang Rong told Reuters on the sidelines of an industry event.

Rong said the firm would launch both CDMA and GSM handsets in India where more than 1.6 million users are entering the wireless sector each month, making it the world's fastest growing market.

Analysts expect mobile phone sales to double to 25.8 million units in India in 2004 on the back of galloping demand for wireless services.

Wide-ranging tax cuts and falling handset prices are also luring users in the country where just three in 100 Indians own a mobile phone compared with more than 20 in China, ZTE's home market.

The company will be competing with more than a dozen global handset majors such as Nokia and Motorola Inc in India, where a mobile phone is no longer a luxury, but a basic business tool.

ZTE already has a growing presence in India's rapidly expanding telecoms sector. It has supplied transmission equipment to state-run Bharat Sanchar Nigam Ltd, the country's largest telecoms firm by revenue.

The number of mobile users is expected to surge to at least 100 million by 2005 from more than 31.5 million now as one of the world's lowest call rates fuel demand.

The 18-year-old company entered the Indian telecoms market about three years ago but is yet to break even, Rong said, adding ZTE's turnover from the country was growing at a rapid clip.

"In 2004, the revenue will be three times more than 2003," she said without elaborating. "We want to make money in the Indian market but that is in the medium to longer term."

ZTE's exports in 2003 exceeded $600 million, more than doubling over the previous year.

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