India imposes curbs on import of some laptops, tablets and computers

0
76

The Directorate General of Foreign Trade (DGFT) on Thursday restricted import of certain laptops and computers under HSN 8471 with immediate effect.

In its notification, the DGFT restricted import of laptops, tablets, all-in-one personal computers and ultra small form factor computers and servers. These electronics can be imported only against a valid license meant for restricted imports.

However, it clarified that it does not bar imports under Baggage rules for the said items.

India’s licensing requirement for imports of laptops, tablets and personal computers will ensure security of its citizens, a source familiar with the matter told Reuters on Thursday, adding the decision was in compliance with the World Trade Organization’s requirements.

The government said the import licensing requirement is exempted for purchase of a single unit of laptop, tablet, all-in-one PCs or ultra small form factor computer, including in cases an unit is bought from online sites. However, such imports will attract taxes as applicable.

You Might Also Like:

Further, it also exempted licensing for imports up to 20 pieces each of these items per consignment, in cases where these are imported for certain purposes including research and development, testing, benchmarking and repair.

Exemption of import licensing is also provided for the said electronics which serve as an essential part of Capital Good, the notification said.

A Push for Local Manufacturing

“However, our ecosystem isn’t ready yet for an assembly of this magnitude. Vendors ship in close to 2 million notebooks every quarter with around 3/4th out of this imported. Also, the almost entire volume of premium notebooks are imported,” Singh said.

He added that the timing isn’t the best as the PC market has been struggling since the last 2-3 quarters and that the timing isn’t the best as the PC market has been struggling since the last 2-3 quarters and this will further dampen the market sentiment.

Goldman Sachs said that the move could benefit Indian EMS (Electronics Manufacturing Services) companies as brands may import semi-knocked down (SKD) units/components and outsource assembly of these devices.

“As India moves away from import of electronics to domestic manufacturing, we anticipate a paradigm shift in the growth of its home-grown EMS companies. Dixon is a major beneficiary of the “Make in India”

push across products, as it is India’s largest EMS for electronics, lighting, mobile phones, security systems and washing machines,” it added.

Anirudh Garg, Partner & Head of Research at Invasset PMS, noted that electronics have been a significant drain on India’s forex reserves. Therefore, the move will foster a conducive environment for domestic electronics and semiconductor manufacturing.

“Companies like Netweb Technologies and Dixon Technologies stand to benefit from this policy, expanding their domestic market share and aligning themselves with India’s push to become a world leader in semiconductor manufacturing,” said Garg.

In April-June, electronics imports, which include laptops, tablets and personal computers, was $19.7 billion, up 6.25% year-on-year. Electronics imports range between 7% to 10% of the country’s total merchandise imports.

India has been trying to push local manufacturing by giving production-linked incentives in over two dozen sectors, including electronics. It has extended the deadline for companies to apply for its $2 billion manufacturing incentive scheme to attract big-ticket investments in IT hardware manufacturing, which covers products like laptops, tablets, personal computers and servers.

The incentive scheme is key to India’s ambitions to become a powerhouse in the global electronics supply chain, with the country targeting annual production worth $300 billion by 2026.

Dell, Acer, Samsung, LG Electronics, Apple Inc, Lenovo and HP Inc are some of the key companies selling laptops in the Indian market and a substantial portion are imported from countries such as China.

The intent seems to be “import substitution of certain goods that are imported heavily,” said Madhavi Arora, economist at Emkay Global.

Laptops, tablets and personal computers compose about 1.5% of the country’s total annual imports and nearly half of those are bought from China, according to government data.

India has imposed high tariffs in the past on products like mobile phones to catalyze domestic output.

3 Aug, 2023

Source : The Economic Times

LEAVE A REPLY

Please enter your comment!
Please enter your name here