China-based global mobile phone set brand Transsion has secured a strong position in local market by establishing mobile phone factory in Gazipur. Their brands from entry level to mid-range, including sub-brands Tecno and i-tel, are already being manufactured in domestic market. As the phone sets are locally produced, the customers get it at comparatively lower prices.

The local brands are fulfilling 90% of the total demand. However, 40% mobile sets are coming into the country illegally. We’ve factories in the country that are manufacturing all the mobile phone set brands except i-phone. Hence, almost all the companies have stopped their import and the local factories have the abilities to fulfill domestic demand. But, our competitive position in the market is facing serious obstacles due to illegal mobile phone sets coming into the country.

Now, our biggest challenge is to embattle mobile phones coming illegally. The mobile set manufacturers have to pay 15% tax and vat. If the mobile sets are produced illegally, then the tax increases to 55%. Due to illegally imported mobile sets, we’re not becoming able to fulfill our own production capacity. As a result, the government is losing substantial amount of vat and tax.

In mobile phone sets of Tk 15,000 crore, the amount of illegally imported mobile phones is around Tk 6,000 crore. We’ve been urging the government to stop the illegal import of mobile phone sets for a long time. We want only the mobile sets having IM number provided by the government should be active in Bangladesh. So, the mobile sets entered illegally into the country wouldn’t be active.

The government had taken initiative in this regard last year and the quantity of illegal phones coming into the country reduced to less than 10%. However, when the government moved away from the decision, then its percentage increased as a natural consequence. The software for registering National Equipment Identity was purchased by spending lots of money, but that’s practically inactive.

Right at his moment, our biggest problem is dollar crisis, for which we’re in trouble in importing raw materials. We’ve to import raw materials three months before production starts. The local manufacturers are facing trouble in having sufficient amount of dollars, while the illegal traders have no such problem as they’re purchasing dollars by using hundee and other medium.

The sale of mobile phones has been decreased by 40% in the period of last November to December, thanks to sloth present economic condition of the country. As the demand fell, we’re running our production with the raw materials in hand. But, the demand of raw materials will be increased ahead of upcoming month of Ramdan and we’re not becoming able to import it according to the demand. We’re expecting a comparatively lower sale this year due to the bad economic condition. There’ll be shortage in our supply if demand increases.

@The writer is the chief executive officer (CEO), Transsion Holdings Bangladesh