Differential duty regime for mobile accessories components to result in total production output by Rs 7000 – Rs 10000 cr by 2018: ICA

The proposal of differential duty regime for mobile handset chargers, batteries and speakers of mobile handsets for supply to mobile manufacturers will give a boost to domestic manufacturing on these products, and will result in a total production output of around Rs 7000 – Rs 10000 crores by 2018, the Indian Cellular Association (ICA) said.

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The domestic manufacture will attract only 2% excise duty while imports will face 29.441% duty. Further, a broad category of inputs including parts, components and sub-parts has been exempted from excise as well as CVD of customs when used for manufacture.

“This particular component manufacturing roadmap is similar to the one which was earlier adopted for boosting growth of the automobile components manufacturing industry in past,” The Indian Cellular Association (ICA) National President, Pankaj Mohindroo, said, adding that there will be a positive impact of this important regulatory intervention on overall transformation of the mobile handsets, its parts, components and accessories manufacturing industry in India

Mohindroo has maintained that in order for the domestic manufacturing Industry to take full advantage of this regulatory benefit, the actual date of implementation of this duty dispensation should be postponed to 01-06-2016 in case for mobile adapters / chargers and 01-09-2016 in case of batteries and wired headsets, considering the lead time required to set up manufacturing operations for these components / accessories.

Currently, most of the parts, components and accessories barring chargers (where some amount of manufacturing activity has been taking place), which go into manufacture of mobile handsets are largely been imported.

And based on the existing duty dispensation, there were no duty advantage / protection for domestic manufacturers to carry out manufacturing activity from India compared to import it from abroad for supply to mobile handset manufacturers on actual user conditions.