New Delhi: The government finally reversed the import duties adding up to around 29.44% on import of batteries used in mobile phones, chargers, wired headsets and speakers imposed in the Budget; buckling under pressure from handset manufacturers.
These components, which comprise 15-20% of the cost of a mid-size phone, can now be imported at zero per cent duty, yet again.
This move of the government has however surprised many as the duties on these components were added in this year’s Budget with an aim to encourage domestic manufacturing and value addition.
Reports claim that handset manufacturers protested stating insufficient quantity of domestic manufacturing taking place. Manufacturers, reports claim, also stated that increased duty would lead to an increase in the prices of their products.
However, yet another section of the industry opines that by reversing the rates, the government has killed the scope for any domestic manufacturing in these products.
Prior to Budget 2016-17, import of almost all mobile handset accessories did not attract any import duty while domestic manufacturing (assembling) was subjected to a concessional excise duty of 1% without the facility of Cenvat credit.