The government has introduced a PLI program worth $2 billion to boost the production of IT hardware. The initiative is projected to result in a significant increase in production over the next three years. Import duties have been reduced as part of this program to encourage domestic manufacturing of IT hardware.
The Ministry of Commerce and Industry informed, “Import of laptops, Tablets, All-in-one Personal Computers, and Ultra small form factor Computers and Servers falling under HSN 8741 shall be ‘Restricted’ and their import would be allowed against a valid License for Restricted Imports.”
The government had announced the restrictions in August, but later in September, called off the impose and deferred the deadline.
The Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said to the reporters, “At present, almost 80 per cent of our supplies to the digital ecosystem come from imports. We want to make sure whatever the sources are, they are trusted. As part of emphasizing trust, it is obvious that the Indian component of that supply chain will have to grow. Today 8-10 percent of our supply requirement comes from India, we want to make that 65-70 percent in the next three years.”
The government aims to reduce the dependency on exporting IT hardware products and encourage domestic production. He also claimed that in three years, India will meet about 70% of the total requirement and, therefore, maintain an adequate supply of consumer electronics.
India had imposed some restrictions on the import in the previous month. However, the government has decided to refrain the regulations from implementing licensing requirements for IT hardware products, including laptops, tablets, and servers. This decision will majorly impact manufacturers such as Dell, HP, Apple, Samsung, and Asus. The new regulations will not restrict incoming shipments for six to nine months. But it is subject to a new deadline and will be effective from November 1st.
According to The International Data Corporation report, the Indian traditional PC market, which includes desktops, notebooks, and workstations, grew by 0.3% year-over-year (YoY) in 2022, reaching 14.9 million units. However, there was a significant YoY decline of 28.5% in Q4 2022.
Hence, the government is aiming to reduce the dependency on exports substantially. Therefore, manufacturers, stakeholders, and conglomerates involved in the IT industry must come together and effectively shape the future of the IT industry and comply with targeted policies to achieve India’s objectives.
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