Govt of India sets limits on the import of PCs, laptops, tablets
India's DGFT (Directorate General of Foreign Trade) has imposed restrictions on the import of tablets, laptops, all-in-one PCs, ultra-small form factor servers and computers falling under HSN 8741. These goods will only be allowed against valid licenses, particularly for confined imports. DGFT's decision to limit imports is anticipated to increase local manufacturing of these items.
The Government of India restricted the import of these items on Thursday. However, importing these electronic and electrical items (EEE) is possible by obtaining a valid license for prohibited imports.
Surprisingly, India imported $10.08 billion worth of these electronics in FY23. Of which $5.3 billion came from China, $896 million from Hong Kong and $1.7 billion from Singapore. DGFT said that exemption from import licence is offered up to 20 products per consignment for Testing, R&D, Benchmarking and Evaluation, Product Development, Repair and Return purposes and not selling. After the use, the items must be destroyed or re-exported. Concerning the re-import of electricals repaired abroad, a licence for Restricted Import will not be needed to repair and return the said goods.
The restrictions won't apply to imports under the Baggage Rules. This Rule refers to the checks every passenger leaving or entering the Indian border has to pass as per Customs. The Ministry of Commerce and Industry mentioned in the notification that there would be an exemption from the Import Licensing requirements for the import of one tablet, laptop, all-in-one personal computer, or ultra-small form factor computer, including those bought from e-commerce websites via courier or post. Imports will be subject to payment of duty as applicable. Also, import is allowed only when these items are essential parts of a capital good.
An anonymous official stated that the decision had been taken keeping national security in mind, with some hardware might be posing risks to India's flourishing IT sector. There is sufficient manufacturing in India to meet the demand. Importers and actual users with a history of imports are permitted to continue importing electronic items.
The import restrictions come amid pressure on India's trade balance, with the merchandise trade debt exceeding $20 billion in June and May. In April-June, India's merchandise imports decreased by 12.7% compared to the first four months of 2022-23, but exports decreased by an even larger 15.1%.
Even as the buying of goods from abroad has decreased on the whole, imports of electrical have increased by 6.3% year-on-year in April-June to $19.76 billion. Interestingly, EEE is India's largest import category after petroleum items.
