The government of India presented its Union Budget 2023 earlier today. There were announcements like dedicated research around 5G, AI, disruptive tech and more that are aimed to boost India’s smart electronics manufacturing industry. One key proposal from the Finance Minister includes the reduction in customs duty on the import of inputs/parts for manufacturing electronic devices.
As per the Finance Minister, the government will provide relief in customs duty on the import of parts like the camera lens used in making the module of smartphones. This will be reduced from 2.5 percent to zero. There will be a concessional duty on lithium-ion cells for batteries to further promote smartphone production in India. The relief will be valid for one year. The benefits will help brands launch 5G smartphones in the budget segment. Additionally, the FM also proposed reducing the customs duty on parts of open cells of TV panels from 5 percent to 2.5 percent.
The reduction in custom duty will make smartphones and smart televisions affordable in the coming financial year. However, the exact revision in prices remainss to be seen. Various OEMs have also hailed the government’s decision. The smartphone industry in India has witnessed massive growth in recent years. It has increased from 5.8 percent from 2014-15 to 31 percent in 2022. The country is already the world’s second-largest mobile phone manufacturer backed by various government policies and incentive schemes.
The reduction in customs duty will also boost the ‘Make in India’ initiative and allow brands like Apple to expand their manufacturing beyond China.
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