Mobile imports jumped 55 percent year-on-year in the first two months of the current fiscal year 2020-21 mainly due to classes moving online and grey markets being stifled due to the closure of the southern border, officials said.

According to the Department of Customs, cell phones valued at Rs7.94 billion entered the country during the period mid-July to mid-September, up from Rs5.10 billion during the same period in the previous fiscal.

Mobile imports in the whole of the last fiscal year were worth Rs18.17 billion.

Sanjay Agrawal, vice-president of the Mobile Phone Importers’ Association, said the grey market lost its supply lines after the Indian border was closed during the lockdown, and consumers had to turn to legitimate sellers pushing up demand.

The Nepal Telecommunication Authority has not been able to implement its plan to whitelist and blacklist all cell phones entering the country, leading to a flourishing grey market in contraband devices.

“Almost 40-50 percent of the mobile phones sold in the country are imported via the grey channel,” Agrawal told the Post.

Grey market mobile phones come especially from India in hand baggage without paying customs. Many travellers also bring phones for their friends and relatives, according to domestic mobile dealers.

Besides the transition to virtual classrooms and remote work, people like to spend their extended home hours engaging in social media, binge-watching and mobile games, which has pushed up demand for the devices.

“Sales of all brands of mobile phones have increased sharply, with some brands seeing two-fold and three-fold growth,” he said.

“With the country in the grip of the coronavirus, activities ranging from work and education to shopping and entertainment are moving online, and sales of mobile phones have spiked accordingly,” said Abhishek Singh, regional sales manager at Vatsal Impex, the sole distributor of MI smartphones in the domestic market.

Most customers look for medium-range smartphones costing between Rs15,000 and Rs30,000 with the main purpose of buying a phone for online study, he added. The latest models have already started hitting store shelves.

There are two types of buyers in the market—people shifting from bar phones to smartphones, and people updating to smartphones with the latest technology, said Agrawal.

“Before the lockdown, each family owned one or two smartphones. Now it has become necessary for every single family member to have a smartphone,” he said.

Mobile phone dealers are launching the latest models with an eye on the upcoming festival, but they said people had started snapping up smartphones after the lockdown, so they don't expect Dashain to add much to their sales.

“We do not expect extra Dashain demand this year compared to last year as buyers have already made their purchases and demand is already high,” said Agrawal. Almost all brands are offering schemes targeting Dashain sales, he added.

MI, Samsung, Oppo and Nokia are the largest selling smartphones in the market currently.

“Mobile sales have been swelling at the rate of 20-30 percent annually, but this year the lockdown boosted sales by 200 percent,” said Agrawal.

Online sales have also risen from 2-3 percent to 7-8 percent with people preferring to buy goods on the internet, said Agrawal.

Nepal imports most of its mobiles from China, Hong Kong and Vietnam, among other places. The lockdown provided an opportunity to convert bar phone users to smartphone users, Singh said.

He expects business to swell by more than 50 percent during the festival. MI devices are becoming popular among consumers due to better product and price, he added.

Besides prices, customers consider the latest features and updates in mobile technology, Singh said. Nearly 45 percent of the branded smartphones sold in the country are MI phones, he added.