India would have 1 billion (100 crore) smartphone users by 2026, with rural areas driving the sale of internet-enabled phones, a Deloitte study said on Tuesday. 

India had 1.2 billion (120 crore) mobile subscribers in 2021, of which about 750 million (75 crore) are smartphone users. It is poised to be the second-largest smartphone manufacturer in the next five years. “The smartphone market is expected to reach 1 billion smartphone users by 2026,” according to Deloitte’s 2022 Global TMT (Technology, Media and Entertainment, Telecom) predictions. 

This growth is likely to be propelled by the rural sector at a compound annual growth rate (CAGR) of 6 per cent, compared with the urban sector growing at a CAGR of 2.5 per cent from 2021 to 2026. “'Higher internet adoption is expected to fuel demand for smartphones; this increased demand will be propelled by the need to adopt fintech, e-health and e-learning,” it said.  Internet-enabled devices in the rural market will also get a push with the government’s plan to fiberise all villages by 2025 under the BharatNet programme. 

Deloitte said that 95 per cent of replacements in the urban market in 2026 would be towards new smartphones, while only 5 per cent would be towards pre-owned phones compared with 75 per cent and 25 per cent respectively in 2021. 

The rural population is expected to demonstrate a similar trend, where the average lifespan of a phone is four years. About 80 per cent replacements are likely to be for new devices, while 20 per cent for pre-owned ones in 2026. Correspondingly, the replacement of feature phones with smartphones is expected to gradually decrease due to a rise in the number of smartphone users.