Is China becoming too expensive for technology manufacturing, or is India's tough market entry rules forcing Huawei to manufacture in the country?

Huawei will soon begin manufacturing smartphones in India, making the Chinese company an important competitor in the fastest-growing smartphone market in the world. Local Chinese media report Huawei will setup manufacturing operations in India, though the exact start date and investment scope have not been revealed.

Peter Zhai, Huawei's president for consumer business group in India, revealed during the Huawei P9 launch in India that the company had gained the manufacturing license in the country and would soon announce their local manufacturing plan.

Huawei expects to make India its second largest device market. By the end of 2016, Huawei will increase the number of its Indian retail specialty stores from the existing several thousand to 50,000.

At present, Huawei is the world's third largest smartphone maker following Samsung and Apple and it is also the top smartphone brand in China. In 2015, the company sold over 100 million smartphones.

Huawei is not a new face in the Indian market. However, the localized manufacturing will help the company reduce costs and faster promote the products to Indian consumers. Many Chinese smartphone manufacturers, including Huawei's rival Xiaomi, have already established manufacturing operations in India.