Xiaomi, once the leader in India’s smartphone market, is losing its throne. The company has not only lost its title as the country’s top-selling brand but is also grappling with falling shipments, frozen funds, and increasing regulatory pressure. This is making it increasingly difficult for the Chinese tech giant to maintain its position in India, once its second-largest market. Here are the details.

Sales Decline, Competitors Rise Rapidly

According to an IDC industry report, Xiaomi’s shipments in India fell by 23.5 percent year-over-year in the second quarter of 2025, pushing it out of the top five vendors. Competitors like Vivo and Oppo, which have a strong presence in the mid-range and premium segments, are capitalizing on Xiaomi’s market share gap.

Xiaomi’s problems aren’t limited to weak sales. Investigations by the Directorate of Revenue Intelligence and the Directorate of Customs, Income Tax, and Enforcement have frozen more than 4,700 crore rupees (approximately $560 million) of its funds. This situation has earned the company a “high-risk” image in the eyes of investors and made its future uncertain.

Executives and analysts also list other reasons for this decline. The decline in marketing activities and departures in key leadership positions since 2022 have led to Xiaomi losing momentum.

Unlike its competitors, its focus on global models rather than models customized for the Indian market has proven inadequate in the face of increasing consumer options. Delays in launching foldable phones and the suspension of India-specific R&D efforts are also contributing factors to this decline.

In 2018, approximately 45 percent of Xiaomi’s global revenue came from India. Today, this figure has fallen to single digits. If the company fails to resolve its legal issues and find a way to reconnect with local consumers, its decline in the Indian market could accelerate further.

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