Basic Import Duty Exemption For Some Electronics, Smartphone Parts

New Delhi: The Centre has waived basic customs duty on goods used in manufacture of display assemblies, lithium ion cell and inductor coil module to promote domestic production of electronic devices like smartphones, laptops, wearables and smart TVs. The move of the government is in line with the government’s efforts to promote domestic electronics manufacturing units under the production-linked incentive (PLI) scheme, while the duty waiver would reduce import dependence and strengthen the electronics ecosystem with local production.

The finance ministry has issued three separate notifications giving effect to the basic customs duty (BCD) waiver on the goods used in manufacture of the three key components used in electronic devices. “The exemptions on inputs used in display assemblies and inductor coil modules would be valid till March 31, 2029,” the notifications said.

AMRG Global, Managing Partner, Rajat Mohan said the government has now consolidated separate customs exemptions for machinery used in the manufacture of lithium-ion cells for mobile handsets and electric vehicles, into a single technology-neutral exemption applicable to machinery used for the manufacture of lithium ion cells. “This simplifies the customs framework, removes end-use-based distinctions, and significantly reduces compliance and interpretational challenges for manufacturers,” Mohan said.

The amendment is expected to encourage fresh investments in domestic lithium-ion cell manufacturing by providing greater flexibility to manufacturers operating integrated production facilities. “The biggest beneficiaries will be battery gigafactories, electric vehicle manufacturers, consumer electronics companies, battery energy storage system manufacturers, renewable energy projects, telecom infrastructure providers, data centres, medical device manufacturers, drone manufacturers and industrial automation sectors, all of which increasingly depend on lithium-ion cells,” Mohan added.