Lenovo, the Chinese smartphone manufacturer, is all known for its affordable yet rich in features smartphones. It also has a contribution in the manufacturing of PCs and laptops. Even though the fiscal year 2016–2017 did not go as expected for the Lenovo users, Rahul Agarwal, CEO, Lenovo India, believes in the company. Let us see as to what he wants to say.
Has ease of doing business improved in India?
It hasn’t changed much. Our ability to enforce a process is low. Platforms like BIS are great but it is slowing certain processes down. If it takes three months to get the products tested, it pulls us back. The central government is doing things in the right direction though.
Till when will issues persist with hardware manufacturing in India?
Companies just assemble in India. We do not have the ecosystem where people are manufacturing various components of a PC locally. We have to start differentiating manufacturing from assembling. Assembling does not add value, jobs and the impact is very low. With the PC market not growing steadily, the manufacturing guys are not keen on opening new plants. Make in India is the right thrust and with the current government things will improve.
What is your role in the digital India initiative?
For the last three years, the market has been flat. It’s quite low compared to China or Brazil. There is hope that as the economy improves; more people will buy a PC and tablet. In the next 15 years, India’s share in PC market will improve. Also, people want thinner and lighter products. Thirdly, we have made a great push towards the gaming segment.
The state governments are pushing for tablets. We have a letter of authorization from the Tamil Nadu government for three lakh laptops and even Ola cabs, Byju’s use our tablets. But individually, there is a question mark on the retail tablet segment.
Moreover, we have got an order for 97,000 tablets from the Gujarat government. Mostly large government deals are combative. Also if vendors delay orders, they are penalized, but when the payments get delayed from government side, there is no extra interest added to late payments.
Will Lenovo’s work in India offset declining numbers in China?
Conviction is there but it will take time. But our Chinese market is bigger than India. I don’t think India can replace China mathematically. But 15 years down the line, India will play a much bigger part of the whole pie. Our dependence on China has gone down. India is the number one country for Lenovo mobile phones.
Analysts say that there is still lot for Lenovo to innovate compared to HP or Dell?
When it comes to innovation, we have objectively done better than our competition. For the last five years, we have got many awards at CES. If I move to smartphones, we have innovated with Moto mods which give them a different dimension. The pace of innovation has become slow overall. Despite the pressure of margins, we have displayed enough backbone to invest on innovation.
Well, Agarwal thinks that the PC market will bloom in next 15 years. Do you agree?