The Indian government’s recent rollout of customs duty exemptions on critical components is set to boost domestic electronic manufacturing and lower retail prices for consumers.
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https://www.india.com/business/will-smartphones-and-lithium-ion-batteries-get-cheaper-centre-rolls-out-customs-duty-relief-on-inputs-to-boost-electronic-goods-production-8469748/
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New Delhi: In a significant step taken towards long-term price reductions for consumer tech, the government has expanded customs duty relief on key components and capital goods to accelerate domestic electronics manufacturing. In its recent step, the centre has taken this move aimed to make local production more competitive. The Central Board of Indirect Taxes and Customs (CBIC) issued three notifications extending these concessions, which is expected to boost infrastructure, attract foreign investment, and eventually pass on cost benefits to consumers, making local electronic goods significantly more affordable in the long run.
Long-term price reductions for consumer tech
While the policy targets long-term price reductions for consumer tech, the immediate impact focuses on strengthening the supply chain. Lowering entry barriers for critical machinery encourages global manufacturers to set up operational bases within the country.
However, the latest exemptions specifically exclude display assemblies for mobile phones and smartwatches, focusing instead on automotive and industrial use. This tactical filtering ensures targeted support for emerging tech sectors while maintaining revenue balance.
Good news for smartphones and lithium-ion batteries manufacturers
The government’s has issued a notification exempting five components used in manufacturing display assemblies for automotive, medical and industrial applications from basic customs duty until March 31, 2029. These include cells, flexible printed circuit assemblies (FPCAs), backlight units, frames and anisotropic conductive film (ACF). The exemption, however, does not cover display assemblies for mobile phones, smartwatches, smart meters, television panels and interactive flat-panel displays.
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List of items included in zero customs duty relief
A separate notification has been issued to extended zero customs duty until March 31, 2029, on six components used in manufacturing inductor coil modules for wireless charging in cellular mobile phones. These include nano-crystalline assemblies, E-shields, PET liners, PC shims, stranded and NFC coils, and neodymium-iron-boron (NdFeB) magnets.
The third CBIC notification has been issued for replacing the existing list of machinery eligible for concessional customs duty for lithium-ion cell manufacturing with an expanded list of 85 capital goods.
The revised list includes coating machines, winding machines, welding systems, testing equipment, formation machines, drying systems and other specialised manufacturing equipment used across the lithium-ion cell production process.
The move aims to improve cost competitiveness and support domestic value addition in electronics and electric vehicles.
(With inputs from agencies)
