India is the second largest smartphone market in the world, only the Chinese market trumps India. That being said, India is the fastest growing smartphone market around, the Chinese market is quite saturated at the moment, and India is still kicking strong, not to mention there's plenty of room for progress as well. Indian government launched a couple of projects which certainly helped the company to grow, their government had launched the 'Make in India' program a while back in order to lure in companies to manufacture devices in India. As part of this program, manufacturers get various benefits if they manufacture in India, and due to that fact, a number of companies opted to join the 'Make in India' program in the last couple of months, including Xiaomi.
China is still the number one priority for Xiaomi, but the company is doing their best to expand their presence in India as well. They've been selling various devices in India, and it seems like they're trying to expand their production capacity in the country. Xiaomi and Foxconn are in talks with a couple of state governments in India, and are trying to set up new manufacturing plants in the country. "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," said Manu Jain, Head of Xiaomi India.
The Xiaomi Redmi 2 Prime was launched in India last year, and that was the company's first 'Make in India' smartphone. Now, the company had to import the Mi Max phablet into China (a device which launched in India yesterday), and they're aiming to avoid that moving forward. It would make things so much easier (and more profitable) if they could set up a couple of new manufacturing plants in India. As a side note, the company had also applied for opening single brand retail stores in India back in March, but the papers are still not approved, India is asking for 'more documentation', at least according to the latest reports. Xiaomi is currently manufacturing around 75% devices in India, the devices they sell in the country, which leaves more room for improvement, and a new plant in India would probably let Xiaomi avoid importing devices from China altogether.