India imposes a ten percent tax on import of key smartphone components

A customs duty of 10 percent was imposed on PCBs that are already populated with components such as memory and chips

India has imposed a 10 percent tax on imports of key smartphone components, including populated printed circuit boards (PCBs), as it moves to step up local assembly of mobile devices in the world’s second-biggest smartphone market.

India imposes a ten percent tax on import of key smartphone components

A woman speaks on her smartphone. Image: Reuters

A customs duty of 10 percent was imposed on PCBs that are already populated with components such as memory and chips, according to a federal government notification issued on 2 April.

Populated PCBs account for roughly half of a typical smartphone’s cost.

Reuters reported last week that India was exploring new customs duty on such components.

A 10 percent customs tax was also imposed on the imports of camera modules for phones and connectors.

The taxes are part of Prime Minister Narendra Modi’s phased manufacturing programme (PMP), a plan unveiled in 2016 to step up local value addition every year in smartphone manufacturing.

Modi, who wants to turn India into a manufacturing powerhouse like neighbouring China, has gradually raised import taxes on low-value components such as batteries, chargers and earphones, pushing Indian firms to assemble them.

The new duties could, however, lead to protectionist outcries from several countries with China, Canada, and the United States recently raising concern at the World Trade Organization about India’s imposition of duties on such devices.

As we follow the planned launch of India's second mission to the Moon, Chandrayaan-2 on 15 July, you can find our entire collection of stories, in-depth analysis, live updates, videos & more on our dedicated #Chandrayaan2TheMoon domain.

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