Mobile Phones To Become Cheaper In India As Govt Slashes Import Duty Ahead Of Budget

The Centre has slashed the import duty on key components used in the production of mobile phones. The move is expected to benefit companies like Apple and Xiaomi.

As per the notification from the Ministry of Finance, the import duty has been reduced from 15 per cent to 10 per cent. The announcement comes ahead of the budget 2024 on February 1.

Going by a notification, the reduced import duty applies to various components including the battery cover, front cover, middle cover, main lens, back cover, GSM antenna/antenna utilizing any technology, PU case/sealing gasket, and other articles made from polyurethane foam such as sealing gaskets/cases. Also, the reduction extends to sealing gaskets/cases made from PE, PP, EPS, PC, and all other individual polymers or combinations thereof, SIM sockets, screws, as well as other plastic and metal mechanical items.

The decrease in import duty would make mobile phone manufacturers acquire these components at a reduced cost. Eventually, this cost-saving measure is expected to translate into a lowering of the overall prices of mobile phones. It means the cellphones is India would get cheaper.

In recent years, Prime Minister Narendra Modi has been promoting India as a smartphone hub, thereby attracting companies like Apple, Xiaomi, Samsung Electronics, and Vivo.

Apple iPhones are currently being assembled in India, and there are plans to expand production to include iPads and AirPods, as a means to reduce dependence on China.

Despite these efforts, the duties levied on mobile phone parts in India stood as the highest among six comparable manufacturing nations, including China, Vietnam, Mexico, and Thailand.

As per the India Cellular and Electronics Association (ICEA), the import tariffs on mobile phone components in India, including camera modules and chargers, currently vary from 2.5 per cent to 20 per cent.

The exports from India have been on the rise, with an increase in mobile phone exports. In the year 2022-23, the exports of mobile phones have doubled, reaching $11.1 billion, in comparison to the previous year, 2021. The industry forecasts a further increase in exports for the year 2023-24, expecting it to reach $15 billion.