Mobile handset manufacturers have sought rollback of increased import duties on inputs for chargers, power banks, camera modules and printed circuit board assembly (PCBA<\/a>), among other items, in the upcoming budget
The duties were hiked in the 2021-22 budget.
Pankaj Mohindroo<\/a>, chairman of the India Cellular & Electronics Association<\/a>, said in a letter to Union Minister of State for IT, Rajiv Chandrasekhar, that raising tariffs on components makes import of the whole part cheaper than manufacturing them in the country.
Scaling back production due to the competitive disadvantage has led to a loss of between Rs 10,000 crore and Rs 15,000 crore, Mohindroo<\/a> added.
ICEA<\/a> has complained that these tariffs “were imposed suo<\/a> motu by the Department of Revenue<\/a>.”
The industry has argued that incentive<\/a>s under the government’s flagship Production-linked Incentive<\/a> (PLI<\/a>) scheme conflict with the increase in custom tariffs on inputs.
“The PLI<\/a> scheme is aimed at decreasing the existing cost disability in India versus China and Vietnam,” the industry body said, adding that any increase in customs duties on inputs will increase this cost disability.
Therefore, it is contrary to the core policy objectives of the PLI scheme as this leads to increase in imports rather than import substitution, it said.
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