01/07/2016 11:16 AM IST | Updated 15/07/2016 8:27 AM IST

Xiaomi Is Planning A Manufaturing Unit In India With Foxconn

Bloomberg via Getty Images
Hugo Barra, vice president of global operations at Xiaomi Corp., gestures while speaking during the launch of the company's Mi 5 smartphone in New Delhi, India, on Thursday, March 31, 2016. Foxconn Technology Group began assembling Xiaomi's first made-in-India smartphone from a new plant in the country's south last year, helping the Chinese company shorten delivery times and prop up margins. Photographer: Prashanth Vishwanathan/Bloomberg via Getty Images

The Chinese phone maker Xiaomi has done spectacularly well in India. In view of the high demand for its phones here, Xiaomi is in talks with different state governments to set up a manufacturing unit in India. It already has an assembly unit in Andhra Pradesh set up in collaboration with the Taiwanese contract manufacturer Foxconn.

Xiaomi will also be partnering with Foxconn, best known as the maker of the iPhone, in setting up any new manufacturing unit in India.

Xiaomi is realizing that after their success in the Indian urban market through the online sales, the best way to tap tier 2 and tier 3 cities would be through offline sales and increasing the supply of their smartphones.

Which could be one reason why Xiaomi is making their Redmi Note 3 available in the offline stores as well. Xiaomi's global VP, Hugo Barra said that they have sold more than a million units of Redmi Note 3 in India so far.

"We are looking to expand capacity and set up more lines and plants. We are proactively looking at it and are working with our partner Foxconn. Currently, discussions are on with different governments. We have also been increasing the capacity at the existing plant," Manu Jain, India head at Xiaomi, told ET.

Yesterday, Xiaomi launched Mi Max which, with a 6.44-inch screen, is their biggest smartphone yet. The phone will be imported from China until production starts in India later this month.

"The demand for Redmi Note 3 is higher. We brought in 6 lakh units for the first two months, which is a fairly big number. Still, we are running out of stock. We have sold more than a million Redmi Note 3 units in India," Jain added.

Chinese smartphone makers are betting heavily on creating online and offline presence simultaneously. One of the newer successful players in the market, LeEco, has opened their own website LeMall. Xiaomi, meanwhile, has set up the Mi Community website, where fans can register themselves for events, launches and exclusive deals.

Despite Xiaomi being quite successful here, we haven't seen the company launching its other products in India. Mi Band is the most sold wearable in India, yet there has been no talk of launching Mi 2 here. Back in China, Xiaomi is diversifying. Recently, they launched a 'foldable' electric bicycle that costs 2,999 Yuan.