I

ndonesia expects to realize around US$300 million in investment in the cell phone industry as part of its goal to produce 35 million cell phones starting in 2017.

The majority of the cell phones will be produced by foreign cell phone manufacturers like South Korean electronics giant Samsung, Chinese smartphone producer Oppo and Chinese electronics maker Haier, all of whom are developing local manufacturing facilities, according to the Industry Ministry'€™s director for electronics and telematics industry, Ignatius Warsito.

Operations at Samsung'€™s new cell phone factory, built in January at a cost of $20 million, have officially begun. The facility is expected to produce 800,000 phones each year in the early phase of its operations.

Meanwhile, Oppo and Haier are finalizing the construction of plants, both of which are expected to commence operations in the first half of this year. Oppo aims to produce between 5 and 10 million cell phones a year, while Haier has yet to announce its production goals. Haier will supply handsets for the local mobile network operator, PT Smartfren Telecom, which reached 15 million subscribers last year.

A portion of the overall investment will involve telecommunication operators who plan to build 3G network-supporting infrastructure, Warsito added.

'€œThis year we are boosting the utilization of 3G. Operators are building receivers for that purpose,'€ he said, adding that this step would facilitate the country'€™s transition from a 2G network to a 3G network this year, and to a 4G network next year.

The $300 million investment in the cell phone industry is part of the $4.5 billion Indonesia hopes to invest in the electronics and telematics industry this year.

With half of its population having risen into the middle class, Indonesia is one of the world'€™s most promising cell phone markets.

In line with the huge potentials, both local and foreign cell phone makers are in a race to tap into the market of 250 million persons.

Local players, such as PT Hartono Istana Teknologi, which manufactures cell phones under the Polytron brand; PT Tera Data Indonusa, which assembles tablets and smartphones under the Axioo brand; and PT Arga Mas Lestari, which assembles tablets under the Advan brand, have set up manufacturing facilities.

Warsito said that to help create a conducive market, the government would further curb the distribution of illegal mobile phones by allowing telecom operators to block their use through the use of the International Mobile Equipment Identity (IMEI) numbers, or identification codes unique to every device in order to control activation of mobile phones.

'€œWe will apply the IMEI control, which is good for our national security and also serves to protect our domestic consumers,'€ he said.