In a significant announcement on Tuesday, the government reduced the basic customs duty (BCD) rates on mobile phones, printed circuit board assembly (PCBA), and mobile chargers from 20% to 15%. This comes at a time when the mobile economy in India has attained new peaks where domestic production has increased three times and exports around 100 times within the last six years. Noteworthy developments underline how far this sector has come.
Presenting the Union Budget 2024-2025, the Finance Minister, while announcing the consumer benefits in the House, said, "In the interest of consumers, I now propose to reduce the BCD on mobile phones, mobile PCBA, and mobile chargers to 15 percent." The electronics sector in India has witnessed rapid expansion, scaled to the $155-billion mark in FY23, and doubled the production from a mere $48 billion in FY17 to $101 billion in FY23. Mobile phones now alone constitute 43 percent of total electronics production.
Pankaj Mohindroo, Chairman, India Cellular Electronics Association (ICEA), hailed the announcement as a landmark budget that concentrates on making manufacturing and exports competitive. "We are impressed with its intent and direction. The Finance Minister has recognized the tremendous growth of mobile phone manufacturing and exports," Mohindroo told IANS. Nevertheless, the regarded recommendation of the industry itself in terms of the 15% BCD on mobile phones, PCBA, and chargers is reflected in a positive manner of improving manufacturing and exporting capabilities.
"The announcements will hugely fortify manufacturing, exports, and our overall competitiveness. Tariff slab rationalization, our proposal on which the FM has assured to look into in the next six months, further empowers the industry," elaborated Mohindroo. As India now manufactures 99 percent of its smartphones, the country is largely free from the clutches of dependence on imports,.
All of this, according to Siddhesh Mehta, a research analyst at Samco Securities, will bring down costs and augment the Indian manufacturing base. "Dixon Technologies is set to gain the most from this decision, which will augment its market position and power growth," Mehta added.
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