India eases import restrictions on laptops and computers, shifts focus to monitoring

Commerce Secretary Sunil Barthwal on october 14 announced that the country would not impose licensing requirements on the import of laptops and computers. Instead, the government will intensify its monitoring of inbound shipments of these electronic devices.

This announcement comes after the Indian government had previously unveiled plans to subject laptops, tablets, and computers to a licensing regime starting on November 1, 2023. The move aimed to encourage domestic manufacturing and reduce imports from countries like China.

Speaking at a press conference in New Delhi, Commerce Secretary Sunil Barthwal emphasized, "On laptops, we are of the view that there are no restrictions as such. We are only saying that somebody who is importing these laptops has to be under close watch, so that we can look at these imports. It is basically monitoring, which we are doing. It has nothing to do with restrictions as such."

Furthermore, Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi stated that an import management system would be implemented by November 1. He added, "The work is in progress, and hopefully, it will be in place before October 30."

The initial announcement in August had prompted concerns within the IT hardware product industry. However, the government's decision to focus on monitoring rather than imposing licensing conditions is expected to alleviate some of these concerns.

India's decision to enhance monitoring without imposing licensing conditions was based on security concerns and a desire to promote the domestic manufacturing of laptops and computers. According to a report by the Global Trade Research Initiative (GTRI), India is highly dependent on China for various electronic products, including mobile phones, laptops, components, solar cell modules, and integrated circuits.

To boost domestic manufacturing, the Indian government had introduced measures like the production-linked incentive scheme and increased customs duties on electronic components. India imports approximately USD 7-8 billion worth of laptops and computers each year.

In the fiscal year 2022-23, the country imported laptops worth USD 5.33 billion, compared to USD 7.37 billion in 2021-22. Imports of certain data processing machines amounted to USD 553 million in the last fiscal year, down from USD 583.8 million in 2021-22. Similarly, imports of micro computers and processors stood at USD 1.2 million, a decrease from USD 2.08 million in 2021-22.

In May, the Indian government had approved the Production Linked Incentive Scheme 2.0 for IT Hardware, with a budgetary outlay of Rs 17,000 crore. The scheme covers the production of laptops, tablets, All-in-One PCs, and servers, aiming to further boost domestic manufacturing in the IT hardware sector.