The Indian Cellular & Electronics Association (ICEA) has urged the government to reduce import duties on manufacturing inputs as a key demand for the upcoming Union budget.
In a report submitted to the Finance Ministry, the ICEA, representing domestic electronics manufacturers, emphasised that India’s mobile phone sector growth now hinges on global market demand rather than domestic consumption.
ICEA President Pankaj Mohindroo highlighted concerns over India’s high tariff structure compared to competitors like China and Vietnam.
According to Mohindroo, these tariffs are affecting the competitiveness of Indian manufacturers in the global market. The association’s report states that current high tariffs increase manufacturing costs in India by 7-7.5 per cent on the bill of materials.
The ICEA report also pointed out that domestic component makers are allegedly inflating prices to just below the net prices of inputs, taking advantage of the tariff situation.
This practice reportedly influences global suppliers’ pricing strategies in negotiations with exporters.
With India’s phone production increasingly focused on exports, the ICEA argues that reducing duties is crucial to enhance the competitiveness of Indian assembly and manufacturing operations against major players like China and Vietnam.
This call for tariff reduction comes as India seeks to strengthen its position in the global electronics manufacturing sector, building on the momentum created by supportive policies such as the Production Linked Incentive (PLI) scheme.