Xiaomi increases prices of all its smartphones after 50% hike in GST1 min read . Updated: 01 Apr 2020, 04:01 PM IST
- Xiaomi's Redmi and Poco smartphones will also get dearer after the hike
- The company released a statement stating the price hike will be effective from April 1
The GST council had announced a hike in GST for smartphones from 12% to 18%. This 50% hike in GST was estimated to increase the prices of smartphones. The new hike has been put into effect from April 1 and Xiaomi has already made it clear that they will be passing the hike to buyers by increasing the price of the all their smartphones.
The company released a statement saying the price hike will be effective from April 1. The company stated, “considering a few other factors and keeping with the Xiaomi policy of making <5% margin on our hardware products, we will be increasing the prices of our products. New prices will be effective immediately."
The company claims that the narrow margin for every smartphone sold in the country and the depreciating Rupee against U.S. Dollar is the reason behind the higher prices. Smartphones that belong to popular subsidiaries of Xiaomi including Redmi and Poco will also receive a price hike.
Xiaomi’s top contender in the Indian market, Realme is willing to absorb the hike in price for its new Narzo series of smartphones.
The hike in price comes at a time when smartphone companies are experiencing trouble due to the coronavirus outbreak. India Cellular & Electronics Association (ICEA) had approached Sitharaman against proposal to hike GST on mobile phones saying that it will be detrimental for consumer sentiments buying handsets and in turn impact local manufacturing of the devices.
ICEA had said that the industry is under deep stress because of disruption in the supply chain due to coronavirus and it is very inappropriate time to consider hike in GST rate of mobile phones from current level of 12 per cent.