The Ministry of Communications and Information Technology (MCIT) has put forth a range of measures for spurring local manufacturing of electronic products. This includes imposing a 10 per cent basic customs duty (BCD) on populated printed circuit boards of telecom goods and certain medical electronic devices.
The recommendations for the upcoming Union Budget will have the IT ministry suggesting the removal of duties on inputs used by export-oriented units for manufacturing of electronic goods for defence as well as space organisations.
As per senior ministry officials, a 10 per cent BCD on populated printed circuit boards (PCBs) will boost local production of the component that is used in mobile phones and computers, among other telecom connectivity equipments.
As per the official, “Duty has also been proposed on preform of silica, for manufacture of optical fibre.” This is with the main goal of bringing the total supply chain and offer more value-addition into local production.
Electronic items now account as the second-most valued category of imports after petroleum products. The demand for electronics hardware is expected to rise to $400 billion by 2020. This may surpass its oil import expenses.
In case the scenario remains unchanged, the ministry will take initial steps with PCBs and some medical devices.