As the Union Budget 2026 draws closer, uncertainty is growing among consumers and the smartphone industry over whether mobile phone prices will rise or fall from February 1. Smartphones, now an everyday necessity for work, education, and digital payments, are closely linked to policy decisions on taxation, manufacturing incentives, and imports.
With rising global demand for AI-powered devices and supply chain pressures, industry experts say the upcoming budget could play a decisive role in shaping smartphone prices in India.
Over the past year, several Indian smartphone brands have strengthened their presence, intensifying competition for established Chinese players. While most Chinese brands kept prices stable, Samsung raised prices on select models toward the end of last year, raising concerns about possible industry-wide price hikes.
With Budget 2026 approaching, consumers are keen to know whether policy changes will provide relief—or add pressure.
According to industry experts, the rapid rise in global artificial intelligence adoption has triggered shortages of critical smartphone components, especially memory chips. This has disrupted global supply chains and increased production costs for manufacturers.
Experts point out that smartphone brands currently have limited ability to absorb these higher costs without impacting retail prices. At the same time, companies remain cautious about pushing prices too high, as affordability plays a key role in India’s price-sensitive market.
Madhav Seth, former CEO of Realme and currently CEO of AI+ Smartphones and founder of Nxtquantum Shift Technologies, said:
"India's technology sector is at a turning point. He notes that the shift will go beyond simple assembly, driven by growing demand for AI-integrated devices, which has already contributed to higher handset prices. Seth believes the Union Budget must focus on promoting deep value creation rather than just assembly-led growth."
His remarks underline the structural challenges facing the smartphone ecosystem, especially as devices become more AI-intensive.
Although most smartphones sold in India are now assembled locally, key components such as:
Camera modules
Batteries
Printed Circuit Boards (PCBs)
Advanced semiconductors
are still largely imported, making manufacturers vulnerable to global price fluctuations and currency movements.
Industry stakeholders argue that targeted tax incentives, import duty rationalisation, and production-linked benefits in Budget 2026 could encourage domestic manufacturing of critical components.
Such policy measures could:
Reduce dependence on imports
Lower production costs over time
Help brands maintain stable pricing
Potentially lead to price reductions in certain segments
Immediate price cuts appear unlikely
Global component shortages and AI-driven cost pressures persist
Budget-led reforms could improve cost efficiency
Strong focus on R&D, system design, and software innovation may help
Domestic component manufacturing could stabilise prices
While smartphone prices may not fall sharply in the near term, the direction set by Union Budget 2026 will be critical. Strategic policy decisions could determine whether smartphones gradually become more affordable or more expensive in the years ahead.