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India Extends Import Duty to More Smartphone Components

India Extends Import Duty to More Smartphone Components

The government of India is imposing import duties on a broader variety of smartphone components, underlining its wider efforts to encourage the local manufacture of devices.

Components including camera modules, printed circuit boards (PCBs) and connectors have been hit with a 10% import duty by the Central Bureau of Excise and Customs. The levy is part of the Make in India initiative, which is intended to foster domestic development and creation of mobile phones and components.

It has been confirmed that only the components themselves will be subject to import duty – the levy will not apply to any equipment essential for their manufacture, meaning there will be no tax on assembling the components in India.

The Make in India initiative is pushing local smartphone production via a phased campaign of measures which will favour Indian manufacture. The government has been upfront about its goal of taxing imports of assembled smartphones as well as several of the components essential for making them. The PCB fee applies to products that feature memory chips, which can constitute up to half of a smartphone’s total materials.

International smartphone manufacturers will be most affected by the programme. China’s Xiaomi and South Korea’s Samsung have both surpassed Indian handset firms in the market, which is now the world’s second largest after China for smart devices. Apple has long requested tax breaks on importing devices and components, but the government’s persistence has resulted in the US-based firm setting up a local manufacturing facility, putting it in the company of Samsung.

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