Budget 2025 – The electronics industry has requested for significant concessions in the upcoming Budget 2025. The industry has sought concessions in the form of lower import duty, especially on key components used in making mobile phones. The industry has called for tariff cuts as the sector has to pay higher import duties than its competitors like China and Vietnam. According to an Economic Times report, the industry has demanded a cut in import duty on components such as inductor coils, microphones and printed circuit board assemblies (PCBA). Phone makers have specifically proposed to cut duty on microphones, receivers, speakers and flexible printed circuit assemblies from 15 per cent to 10 per cent. They have also sought abolition of 2.5 per cent duty on printed circuit board assembly parts, ET reports.
India’s effective tariff on mobile phone inputs ranges from 7 percent to 7.2 percent, according to the industry. This is much higher than China and Vietnam. These issues were raised during the pre-budget meeting with Finance Minister Nirmala Sitharaman on December 26.
The India Cellular and Electronics Association (ICEA) has also recommended a simpler tariff structure. It advocates duty-free import of inputs and sub-parts, 5 percent duty on certain component parts and 10% tariff on sub-assemblies and components. This has been said in the report.
However, Moneycontrol could not independently verify the report.
Apart from tariff cuts, the electronics industry has sought subsidies on mandatory testing and product certification. The Electronic Industries Association of India (ELCINA) has suggested that the government should provide financial incentives for MSME companies, increase testing capacity and set up subsidized testing and certification facilities.
Additionally, the ET report also said that the industry has pushed for extension of 15 percent corporate tax exemption for manufacturing companies till March 31, 2029, to encourage new ventures in the components sector. ELCINA has also proposed a dedicated incentive package to support the creation of manufacturing clusters for components.