Duty on mobiles after GST: iPhones to get costlier; local brands won't gain
Smaller players could be
routed; major Indian brands may not get any significant advantage
Latest
news : The Union
government is mulling imposing a 15 per cent basic customs duty (BCD) on the
import of finished mobile handsets once the Goods and Services Tax (GST) comes
into effect.
The move is intended to protect manufacturers who have set up
units in India and put a curb on the outflow of foreign exchange to countries
like China, Taiwan, and Vietnam.
Boosting local manufacturing or assembly of mobile phones is
a key part of Prime
Minister Narendra Modi’s pet project — Make in India.
What the government intends to do?
The Commerce and Industry Ministry had proposed a customs
duty of 15 per cent on smartphone imports. Under the Phased Manufacturing
Program (PMP) developed by the ministry of electronics and information
technology, the government aims to enable large-scale manufacturing of mobile
phones. As local value addition in handsets remains as low as two per cent at
present, sub-parts such as mechanics, microphones, receivers, keypads, and USB
cables, among others, have been targeted in the initial stage.
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