Smartphone Prices in India May Rise Further

New Delhi: Smartphone prices in India are set to rise further as handset makers grapple with rising prices of memory chips, processors, and other components. Smartphone prices are increasing across brands and categories as companies report higher costs for components such as memory, processors and displays.

Phones in India are expensive for the average consumer, with price increases being reported across multiple brands and price ranges.

Reasons Behind the Increase in Smartphone Prices

The main reason behind the current increase in smartphone prices is memory. Smartphones use DRAM and NAND memory for storage, while cutting-edge processors and data centers for artificial intelligence require high bandwidth memory.

Due to heightened demand driven by artificial intelligence applications, memory manufacturers are prioritizing high-margin AI chips over smartphone and PC memory, causing a shortage of memory for phones and laptops. Additionally, as a result of rising material costs, phone makers are choosing between eating into their profits and passing on the costs to consumers.

Artificial Intelligence Impacting Smartphone Production

Artificial intelligence is quickly becoming one of the most important end markets for semiconductors. AI data centers are capital-intensive and require millions of chips, including GPUs and high-performance memory.

While smartphones are witnessing stiff competition and declining sales, the demand for semiconductors in AI is impacting the broader semiconductor market. The confluence of these factors has resulted in an unexpected impact on the smartphone market.

Industry analysts believe that if the demand for AI continues to surge, the impact on the smartphone market will continue to linger. Memory shortage is also likely to persist through 2027, with some manufacturers already feeling the pressure. Smartphone manufacturers in India have already witnessed rising prices of components like processors and memory.

Samsung, OnePlus, OPPO & Other Brands Hiked Prices

In India, several smartphone manufacturers have already responded to the rising component prices by increasing the prices of some of their smartphones in response to rising component prices.

Samsung, OnePlus, OPPO, Vivo, Xiaomi, Realme, Motorola, and Nothing have all felt the effects of rising component prices in 2026. However, according to recent news reports, smartphone manufacturers in India are also facing a significant processor price increase. According to Counterpoint Research, Qualcomm has notified several customers about double-digit price hikes for some of its chips that will be available in September 2026. These developments could lead to further increases in smartphone prices in India.

Rising Prices are Mainly Affecting Budget Smartphones

The current situation with rising component prices is having the highest impact on budget smartphones. India is home to many price-sensitive consumers who purchase budget and mid-range smartphones. As a result, smartphone manufacturers that sell budget and mid-range smartphones have limited ability to pass on component price increases to consumers while maintaining profit margins. This is especially true for the entry-level smartphones in India.

According to TechCrunch, with Counterpoint Research, shipments of smartphones in India dropped nearly 10% year over year in the first quarter of 2026. Moreover, lower-priced smartphones saw a drop of 45% in shipments in the same quarter.

As a result of rising smartphone prices, smartphones in the budget segment are becoming less accessible to India’s price-sensitive consumers.

Smartphone Prices are Increasing Post-launch Periodically

While it has become typical for smartphones to witness price hikes after the initial discounts following their launch, some manufacturers are now witnessing prices rising even before the end of the initial price launch period. Smartphone manufacturers typically keep the initial selling price of a smartphone unchanged for around six months after its launch.

However, as soon as there is a price increase in components, manufacturers feel the need to increase smartphone prices. Certain smartphones have seen their prices rise by thousands of rupees within a few months of their launch. Smartphone manufacturers are also seeing prices of older models rising when component prices rise.

As a result, potential smartphone buyers must consider that the smartphone they are thinking of buying may become more expensive once it is launched or once the model changes. Thus, buyers who are waiting for a significant price drop in a smartphone may need to rethink their assumptions.

Will Smartphone Prices Come Down?

The situation with regard to smartphone prices depends to a large extent on the availability of memory. If the worldwide shortage of memory persists, smartphone manufacturers may find it difficult to reduce smartphone prices in the near future. Companies like IDC have warned that the worldwide memory shortage would have an adverse impact on the PC and smartphone markets, including the pricing and product mix decisions made by smartphone manufacturers.

Therefore, while higher smartphone prices are likely to be a temporary phenomenon, it is unclear when prices will stabilize.

Should You Buy a Smartphone Now or Should You Wait to Buy?

When it comes to buying a smartphone, consumers should take their time.

If your current smartphone is not old or damaged in any way, it is best to wait until the smartphone prices come down before buying a new smartphone. However, if you already need a smartphone, waiting for smartphone prices to come down may be a risky proposition if you need a smartphone in the near future.

In order to get the best deal on a smartphone, buyers should:

• Compare prices at different retailers
• Take note of the original launch price of the smartphone
• Look out for exchange and bank offers
• Consider the option of buying a last year’s flagship model
• Go for a smartphone with sufficient RAM and storage without paying extra for unnecessary features
• Compare competing smartphones in the same price range

Impact of Rising Smartphone Prices in India

Rising smartphone prices in India are a matter of concern given the number of smartphone manufacturers operating in the country and the number of smartphone buyers who are sensitive to changes in smartphone prices. Smartphone manufacturers in India must balance the rising production costs with the need to provide affordable smartphones to Indian consumers.

Consumers on the other hand must make the most of the available offers in order to buy the most suitable smartphone for them before smartphone prices rise further.

Semiconductor shortages in 2026, which are affecting both PC and smartphone manufacturers, may lead to further increases in smartphone prices. In the near future, smartphone prices in India are likely to witness further increases.