Both companies announced that the outlook is good in India. Baidu opened its office in India last year, while Xiaomi has been in Andhra Pradesh since 2014.
Baidu's forecast is based on the trends in India showing that there is a growing demand for e-commerce and use of mobile technology, especially among the youth. Another plus factor is India's booming population.
Based on the report issued by the World Bank, Internet penetration was only 18 percent of the population in 2014. In the same year, half of China's population were already online.
India is also seen to exceed China's population by 2022 and will become the most populous country in the world. Xiaomi and Baidu expect that the market will dramatically expand.
The Internet and Mobile Association of India reported that there are 402 million Internet users in India at the end of 2015, an increase of 49 percent from the previous year. Most users access the Internet through their mobile phones.
Xiaomi already sold 13 types of smartphones and tablets in 1,500 smaller cities outside New Delhi, according to Xiaomi India's operations head, Manu Jain.
Jain added that the company is already selling more than 1 million units of phones and chargers every quarter. The bestselling unit is the Redmi Note 3.
The phone manufacturing industry in India is also on the rise. Jain said, "Currently, more than 75 percent of our devices sold in India are made in India."
Baidu is already maximizing the growth in India. Josh Fenn, a senior marketing manager at Baidu's global business unit said that "mobile advertising is annually growing by 60 to 70 percent."
Fenn admitted that the main challenge in India is a lack of infrastructure because 3G and 4G networks are still lacking in larger parts of the country.