High tariffs on phone parts nullify PLI impact: ICEA
New Delhi, July 2
India Cellular & Electronics Association (ICEA) has made a case for reduction in input tariffs on smartphone components in the forthcoming Budget to be unveiled later this month.
The India Cellular & Electronics Association (ICEA) said higher input tariffs perpetrate import dependency and “restrict” the potential impact of PLI. ICEA outlined three major recommendations: rationalise tariffs on mobile phone parts and sub-assemblies, policy and financial support to develop a large-scale ecosystem, and establish global-scale factories and warehousing to ensure timely delivery.
“Higher tariffs make India incompetent beyond import substitution, and creates a viscious cycle of high prices by domestic suppliers, and global suppliers, including those operating in India,” ICEA said.
High tariffs also significantly lower the tendency of global firms to shift production to India, it said. “Building local supply chains is a slow process due to lack of technology, high cost of finance, and skill gap, and importing inputs involves a high tariff, so what we were intending to do with PLI, because of these restrictions, it is not growing as expected,” ICEA Chairman Pankaj Mohindroo said.
