Duty cuts on mobile parts, components to boost India’s electronics goal: Industry body

New Delhi: Reduction of duties on mobile parts and components in the Union Budget 2025-26 would further strengthen India’s position as global electronics manufacturing hub towards achieving the goal of a $500 billion electronics industry, the India Cellular and Electronics Association (ICEA) has said.

In a letter to Sanjay Malhotra, Revenue Secretary, Ministry of Finance, the apex industry body recommended to reduce the 2.5 per cent duty on parts and inputs of PCBA, FPCs, camera modules and connectors to zero per cent, adding that high tariffs on sub-assemblies and their components inflate manufacturing costs.

FPCBAs are currently classified as PCBAs, though their functionality is similar to connectors. The ICEA recommended that FPCAs should be categorised under a new HSN Code at 10 per cent duty.

“The current 2.5 per cent tariff on inputs hinders competitiveness and discourages local production because of lack of sufficient differential duty. We recommend to reduce the duty on sub-assembly inputs for open cells to zero per cent to support domestic television manufacturing,” said the ICEA letter.

The 15 per cent duty on car displays and similar duty on parts like Blu, Cover glass, Open Cell, and more are at 15 per cent, creating an inverted and convoluted duty structure while reducing cost effectiveness.

“Display manufacturing is similar across segments so to encourage and build scale for display assembly manufacturing in India all inputs of Display Assembly irrespective of the end use should be at zero duty aligning with the duty structure of mobile phone display,” the ICEA suggested.

To support the nascent domestic industry for hearable devices, it is essential to maintain the existing duty structure while ensuring components and inputs are duty-free, it said, adding that inverted and convoluted duty structures on parts, sub-parts, and inputs of Inductor Coil module increases costs and creates complexity in customs processes and clearance delays.

—IANS