Production of handsets by the local companies dropped 25 per cent in September, according to the Bangladesh Telecommunication Regulatory Commission (BTRC).
In August, the total production of handsets was 2.97 million units, which came down to 2.27 million units in September, as per the BTRC data.
However, the production of feature-phone handsets increased to 73.62 per cent of the total in September from 72.17 per cent in the previous month - at a time when the country is moving to adopt 5G technology.
The total production of handsets almost halved in nine months - from 4.45 million units in January to 2.27 million units in September, according to the BTRC monthly data.
In September, the production of 4G smart-phones in the country was 582,000 units and that of 5G 5,000 units. In August, 8,23,000 units 4G phones and 3,000 units 5G phones were produced locally.
On the other hand, the production of 2G or feature phones was 1.64 million units in September.
The local manufacturers stopped producing 3G handsets in May. The telecom regulator earlier decided to ban import, assemble and manufacture of 3G-only handsets - to promote widespread adoption of smart-phones to support digital transformation in the country.
According to the Bangladesh Mobile Phone Importers and Manufacturers Association, the mobile handset market in Bangladesh is worth over Tk 100 billion or roughly US$1.2 billion.
The annual demand for mobile handsets is more than 35 million, but the use of local handsets is declining.
A top official of a handset manufacturer said the declining trend is a testimony of economic downturn in the country.
But Director of Policy Research Institute of Bangladesh (PRI) Dr Mohammad Abdur Razzaque said the declining trend may not be linked to the economic situation only.
The reason might be that Bangladeshi handsets are not good enough in quality, he added.
As of January 2021, local manufacturers fulfilled almost 80 per cent of the country's mobile phone requirement. The sector generated more than 15,000 jobs.
Currently, 15 companies have licences to manufacture mobile handsets. These include - Walton Digi-tech Industries Ltd, Fair Electronics (Brand - Samsung), Edison Industries (Brand - Symphony), Alamin and Brothers (Brand - 5 Star), Carlcare Technology BD Ltd (Brands - itel and Techno), Anira International (Brand - Yunstar), Best Taicool Enterprise Ltd (Brand - Vivo), Grameen Distribution (Brand - Lava), Banglatrinic Technology (Brand - DTC), Benley Electronic Enterprise (Brand - Oppo), Okay Mobile, and Mycel Technology.
To encourage local manufacturing and assembling of smart-phones and attract foreign investment, the government has taken various steps under its "Made in Bangladesh" programme.
Foreign phone brands are incentivised to opt for manufacturing or assembling in the country by increasing tariffs on imported handsets, imposing lower duties on import of components, and exempting consumer purchases from value added tax (VAT).
