Govt cuts Customs duty on some mobile parts, industry seeks more

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The government on Tuesday announced duty concessions on certain mobile phone parts that may make some of the mobile handsets cheaper. The industry, however, asked the government to further cut duties on mobile parts.

The government said that the duty concessions are being given to parts of the transformer of mobile phone chargers and camera lens of mobile camera module, and certain other items.

“This will enable domestic manufacturing of high-growth electronic items,” Finance Minister Nirmala Sitharaman said in her Budget 2022-23 speech.

The basic Customs duty (BCD) on camera lenses for use in the manufacturing of camera modules has been cut from 15 per cent to 2.5 per cent.

However, according to the India Cellular & Electronics Association (ICEA), even 2.5 per cent Customs duty is “completely unnecessary”.

The BCD rate on specified parts of transformers for use in mobiles were changed from 0 per cent to between 10 and 15 per cent in the last Union Budget, which has now been cut to 5 per cent.

These parts are copper wire-enamelled, insulation tape, ferrite core, triple insulated winding wire, and varnish.

“While we had accepted the duty change on plastic bobbin, on the other, we had requested for reversion to 0 per cent duty. The change to 5 per cent BCD now is welcome, but we are continuing to request for 0 per cent on these,” said ICEA.

The industry body said that the nuisance tariff of 2.5 per cent on various inputs for PCBA of chargers, and inductors for PCBA for mobiles still continue.

“Other parts of the camera module, like actuator assembly and parts of sensor continue at 2.5 per cent which is again unnecessary,” the ICEA added.

The government, however, reverted the Customs duty on parts of PCB (gold and aluminium) from 2.5 per cent to 0 per cent.

“The announcements will give a much-needed boost to increased localisation for camera lenses (used in the module) and transformers in chargers/adaptors. However, we do not see these translating into immediate gains for the consumers,” Prabhu Ram, Head-Industry Intelligence Group, CMR, told IANS.

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