A K-shaped recovery: Smartphone sales show a troubling divergence

livemint.com:

Many close observers of India’s economy have been concerned that inequality could slow down its rise if a large proportion of the population gets left behind. Could we already be running into speed-breakers in some sectors? Take internet penetration, which till some years ago was seen to be fast bridging our digital divide. No longer.

Data from the Telecom Regulatory Authority of India reveals a slump in 2021 and 2022, with this year’s early part no better. This was accompanied by a contraction in smartphone sales in 2022, according to International Data Corporation figures. This year’s offtake has also been disappointing.

Of course, covid supply disruptions had raised input costs and pushed even cheap handsets out of the reach of many more people at the entry level. At the top end of the market, though, premium player Apple has been doing very well. These numbers are symptomatic of a K-shaped recovery from the pandemic.

Other consumer markets have also had pricey products selling better than low-priced options. This suggests haves and have-nots have seen a divergence in what they can afford. And that’s not good for the long-term sustainability of economic growth.