With India's Finance Minister P Chidambaram having announced in his Budget for 2013-14 speech that the excise duty for handsets costing more than Rs 2,000 is being increased by 6 percent, customers thinking of purchasing expensive smartphones - such as the Apple iPhone or the Samsung Galaxy S III - will now have to shell out more money.

In his budget speech, Chidambaram said that the government had waived the duty for machinery imported for local chip manufacturing, while simultaneously increasing import tax by 5 percent on set-top boxes and mobile phones handsets more than Rs 2000; in an apparent effort to give a boost to domestic manufacturing vis-a-vis importing.

Given the fact that mobile phones currently attract 1 percent excise duty, Chidambaram said that the decision to hike the duty for mobile phones costing more than Rs 2,000 will not have any substantial impact on the majority of customers; and pointed out that "70 per cent of imported mobile phones and about 60 per cent of domestically manufactured phones are priced at Rs 2,000 or below."

With Gartner estimates showing that the potential sales of mobile phones in India will touch approximately 251 million in 2013, the budget measures announced by Chidambaram will clearly prompt domestic mobile phone brands - including Micromax, Lava, and Karbonn - to accelerate their plans for local production.