NEW DELHI: In a move that can make mobile manufacturing cheaper in India, the government on Wednesday announced a reduction in import duty on certain mobile components.
According to the gadget notification, the government slashed import duty to 10% on components such as the battery cover, main cover, GSM antenna, and others.
The move is in line with the recommendation of the Indian Cellular and Electronics Association (ICEA), which suggested duty cuts to reduce the cost of making smartphones in India. According to ICEA, mobile phone exports from India could triple to $39 billion over the next two years, from $11 billion in FY23, if the government reduces import tariffs on components.
"This is a critical and welcome policy intervention by the government towards making mobile manufacturing competitive in India. Building scale and riding on low input tariffs are key to transforming India into a global hub for electronics manufacturing and exports," said Pankaj Mohindroo, Chairman of ICEA.
"Electronics have improved from the 9th position a few years ago to India’s 5th largest export in 2024. Mobiles constitute over 52% of electronics exports, thanks to the PLI Scheme. This is the first industry to leapfrog from import substitution to export-led growth within the last 8 years. The government has been an excellent and willing partner in this transformation," added Pankaj Mohindroo.
However, the Global Trade Research Initiative (GTRI) advised against cutting import duties on electronic components in the upcoming budget.
The think tank is of the view that the current tariff structure has already proven successful in supporting local manufacturing, and any changes could jeopardize the industry’s growth.
It was recommended that Indian manufacturers pay duties on smartphones sold within the country, while exports should be exempt from such duties.