Just as the country is about to enter the era of 5G, the production of smartphones in Bangladesh has declined due to rising inflation and dollar prices.
Local smartphone production declined by around 50% month-on-month in May from April, according to the Bangladesh Telecommunication Regulatory Commission (BTRC) data.
Local manufacturers produced a total of 660,000 smartphone units in May, whereas the country produced 1.32 million smartphones in April as per the data.
The production of mobile phones has also declined in the last five months from 4.1 million units in January last to 2.3 million units in May last, according to data released by the regulatory body.
Local industry players and insiders said that rising dollar prices and soaring inflation has caused people to cut down on expenses, impacting their purchase power.
According to local mobile manufacturing and assembling industry players, their sales declined by over 20% this year.
Chief Operating Officer of Walton Mobile Md Abu Jahid told Dhaka Tribune: “The production has not declined to that extent, rather the sales have declined. This happened as the prices of mobile phones increased due to the inflation and hike in raw material prices, freight costs and dollar prices, which led to increased production costs. Walton's mobile phone production is normal.”
Co-Founder and CEO of Pickaboo.com Morin Talukder echoed the same sentiments.
“In the last three months, smartphone prices have increased twice. In May, the price increased by 8-10% for the dollar price, while in June, the price was again increased for the inclusion of stage VAT,” he told Dhaka Tribune.
“We see the demand for smartphones has dropped by 35-40% in the last two-three months with sales declining significantly even with Eid, as sales during this festive season were not satisfactory - despite huge discounts and EMIs being offered for purchases,” the Pickaboo top-brass also said.
Currently, 15 companies have licences to manufacture mobile handsets. Of which, 14 manufacturers meet over 90% of Bangladesh's demand for smartphones.
However, the share of local mobile phone manufacturers also fell from 33.55% in January to 28.47% in May.
According to data, 71.53% of total handsets manufactured in the country are feature phones while 28.47% are smartphones.
In April, smartphone production was 1.3 million units - 1.3 million 4G and 52,000 5G phones.
On the other hand, the production of 2G or feature phones in May was 1.7 million units.
According to Bangladesh Mobile Phone Importers Association (BMPI), the mobile handset market in Bangladesh is worth over Tk10,000 crore or roughly $1.2 billion.
The annual demand for mobile phone handsets is more than 35 million. Of which, 11 million units are smartphones.
