Atmanirbhar Bharat: Key component for TV manufacturing to attract 5% import duty from 1 Oct
Open cell panels are a key component for television manufacturingAs part of 'Atmanirbhar Bharat' the govt is keen to expand domestic production capacity for open cell panels
NEW DELHI: Open cell panels, a key component used in the manufacturing of television sets, will attract 5% import duty from 1 October, with the government saying that a duty exemption expiring at the end of this month will not be extended - to boost domestic production.
As part of 'Atmanirbhar Bharat' the government is keen to expand domestic production capacity for open cell panels so that imports can be curbed.
The one-year exemption given to the item expires on 30 September, explained a government official, who asked not to be named.
“The tax break was offered for a limited period of one year in anticipation that the industry would build capacity for manufacturing critical components in India. For India to be self-reliant, manufacturers cannot remain merely assemblers of imported parts. Manufacturing in India cannot survive on support of imports forever," said the official.
The government has supported domestic television production by way of tariff protection. A 20% customs duty has been in place on television imports since December 2017 and television import has been put in the restricted category, effective 31 July.
Television producers import these panels for ₹2,700 for a 32-inch unit and for ₹4,000-4,500 for a 42-inch television unit, which translates to a duty impact of ₹150-250 per television, said the official.
The Narendra Modi administration is taking steps to boost local manufacturing and stem imports to help the economy recover and to generate employment. The government last year cut corporate tax rate to encourage setting up of new factories and in March offered production linked incentives (PLIs) for manufacture of electronics items. The PLI scheme offers 4%-6% incentive to eligible electronic companies on incremental sales of manufactured goods over the base year of 2019-20. The items covered include mobile phones and electronic components such as printed circuit boards and sensors.
“No real manufacturing growth of television could happen unless open cell is locally made. The present activity carried out by the industry is only of assembly of television after importing most of the parts. This cannot go on for long as assembly does not entail any significant value addition. Deepening of value addition in the domestic market must happen in phased manner," the official added.
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