Thursday, December 4, 2014: In a way to offset the possible impact from the US-China trade pact which removes import tariffs on a host of electronic items, the government will have to strengthen its efforts to promote local manufacturing of electronics. In the line with the pact which was been signed last month, India is facing intensive pressure to sign the extended Information Technology Agreement (ITA).
Perhaps the country is not in favour of signing the pact at present, since they believe that the pact will be fruitful only after domestic manufacturing will be strong enough.
The pact will also go against PM Modi’s ‘Make in India’ campaign since it will make imported goods cheaper than the domestically manufactured goods. According to a government official, even though India has lost China’s support in opposing the ITA, it will not sign the pact yet. The official also noted, “From the perspective of promotion of electronics manufacturing, it is not in our interest to sign.”
Despite massive technological innovations and additions in the past 17 years, the foremost ITA which was signed in 1997 has not been reviewed. Official stated that at that as well, all the countries didn’t sign the pact as and when asked for.
The first phase of ITS had covered almost all the prominent electronic items, thereby to allow the import costs to go down, all the member countries had removed the import duties on the items covered under the pact.