Samsung has ceded the top spot in India's burgeoning smartphone market to China's Xiaomi.

Samsung ruled supreme in India's smartphone market, scaled at more than 100 million phones a year, since 2011. But Chinese rivals aggressively expanded their presence in India, Southeast Asia and Europe and are now posing a direct threat.

Even as Samsung was battling it out with Apple in the premium market, Chinese rivals expanded their share of the affordable market, trapping Samsung awkwardly somewhere in between.

◆ Waning Market Dominance

Hong Kong-based market researcher Counterpoint Research said, Samsung achieved a 23-percent share of the Indian market in the fourth quarter last year, allowing Xiaomi to overtake it with 25 percent. U.K. market researcher Canalys estimates that Xiaomi shipped 8.2 million smartphones to India last quarter and Samsung 7.3 million.

Even until the fourth quarter of 2016, Xiaomi accounted for just a nine-percent share of the market, but it caught up by the third quarter last year. Park Jin-suk at Counterpoint said, "Xiaomi's strategy of rolling out affordable smartphones with high-end features paid off." Other Chinese smartphone makers rank at No. 3 to 5, with Lenovo, Vivo and OPPO at six percent each.

"It's very important for Samsung to maintain a lead in India, which is the world's second-largest market for smartphones," an industry insider said. "Samsung is probably feeling quite threatened right now."

