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Trade Trends News
01-02-2024
India has cut import duties on some components used to make cell phones to 10 percent from 15 percent, a move that benefits companies like Apple (AAPL.O), which opens a new tab, and Xiaomi (1810.HK), which opens a new tab for manufacturing in Asia's third-largest economy.
Import tariffs on parts such as battery covers, main camera lenses, back covers, other plastic and metal mechanical products, and GSM antennas have been reduced to 10 percent, the Ministry of Finance said in a notice issued Tuesday evening.
The import duty on inputs used for manufacturing these components has been reduced to zero, the notification said.
In recent years, Prime Minister Narendra Modi has made India a smartphone manufacturing center, boosting companies such as Apple, Xiaomi and Samsung Electronics (005930.KS), opening up new tabs and Vivo expanding handset assembly.
However, tariffs on cellphone parts are the highest among six comparable manufacturing countries including China, Vietnam, Mexico and Thailand, prompting the industry to push for tax cuts.
Rajat Mohan, a director at tax consultancy MOORE Singhi, said, "The cut in import tariffs on cellphone components will help large global manufacturers set up large-scale cellphone assembly lines in India and significantly increase cellphone exports."
Earlier this month, Reuters reported that India was considering cutting import tariffs on key components used to produce high-end cell phones.
The Indian Cellular and Electronics Association (ICEA) said in a statement that the move would make India's cell phone manufacturing industry more competitive.
According to industry estimates, the country's handset exports doubled year-on-year to $11.1 billion in the fiscal year ending March 2023 and are expected to rise to $15 billion in the current fiscal year as global mobile companies manufacture in India.
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