Smartphones, smart watches to be expensive as Govt hikes import duty

New Delhi, Oct 12: The government on Thursday has hiked the import tariffs on several electronic items and communication devices in an effort to bolster a falling rupee that is rapidly hurtling towards the 75 mark against the dollar.

The rupee has slid 14 per cent this year and by most accounts it could depreciate further.

This is the second round of import duty hikes after the government on September 26 increased import duty on 19 items, including household refrigerators and air conditioners, as it looks to cut non-essential imports to check the widening Current Account Deficit (CAD).

The latest set of increased tariffs could ratchet up trade tensions with the United States and China, among other countries and hurt the likes of network equipment makers such as Cisco Systems Inc, Huawei Technologies Co, ZTE Corp, Ericsson, Nokia and Samsung Electronics.

However, it is not immediately clear how much of a tariff increase is being levied on each specific item, but the Indian government listed several items that could be impacted including wearables like smartwatches, Voice over Internet Protocol equipment and phones, and ethernet switches, among other items.

The duty on base station and digital line systems has been doubled to 20 per cent from 10 per cent.

The duty hikes would be effective from Friday.