Another factor that has contributed to the growth of the mobile handset market is the much lower R&D costs in India, which typically account for more than 40% of the total product development cost. As a result, the last five years have seen companies like Nokia, Motorola, Alcatel & Ericsson establishing their design and R&D centers here in India. Not only this, even the government realized the immense growth opportunity that lies in the telecom sector and made some noteworthy regulatory changes to significantly bring down the custom tariffs from 10% to 5% and abolished the Special Additional Duty of 4%; the changes that forced many mobile handset manufacturers and original equipment manufacturers to consider the option of manufacturing in India.
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Source : IIPM Editorial, 2007
An IIPM and Management Guru Professor Arindam Chaudhuri's Initiative