New Delhi:

The government is likely to put in place a simple import authorisation procedure and not a licensing process for inbound shipments of laptops, tablets, and computers from November 1, according to sources. However, they said the commerce ministry is awaiting a final word on the issue from the Ministry of Electronics and Information Technology (MeitY).

The government in August imposed import restrictions on laptops and computers (including tablet computers) with a view to boost domestic manufacturing and cut imports from countries like China.

As per the notification of the Directorate General of Foreign Trade (DGFT), the restrictions will come into force from November 1.

While the IT hardware product industry comes under MeitY, the DGFT notifies decisions with regard to the import/export of a product.

Following this notification, the IT hardware industry had flagged concerns.

“It will be more in the nature of an import management system where people will be issued an authorisation. It will be a very soft licensing. It will just be an authorisation,” one of the sources said, adding that everything will be online.

A company will be able to put up a request for imports of certain numbers and it would get the authorisation for imports.

According to the source, the DGFT may also have to issue a clarification on its earlier notification (dated August 3) which has stipulated a licensing regime for imports of these goods.

The order issued in August had put licencing requirements with immediate effect and later, amendments were made, and a transition period was provided till October 31.

The restrictions are also there on microcomputers, large or mainframe computers, and certain data processing machines.

India already has an import monitoring system for certain products like steel, coal and paper.

The licensing conditions on imports were put on the grounds of security and to spur domestic manufacturing of these products.

While announcing the licensing rules the government had also said that it wants IT products to come from “trusted sources”.

According to a report by think-tank Global Trade Research Initiative (GTRI), India is critically dependent on China for day-to-day use and industrial products like mobile phones, laptops, components, solar cell modules, and ICs.

The government has taken several steps to boost domestic manufacturing of electronic items such as rolling out of the production-linked incentive scheme and increasing customs duties on the number of electronic components.

Leading electronic brands which are sold in the market include HCL, Samsung, Dell, LG Electronics, Acer, Apple, Lenovo and HP.

India imports about USD 7-8 billion worth of these goods every year.

The country has imported personal computers, including laptops, worth USD 5.33 billion in 2022-23 as against USD 7.37 billion in 2021-22.

Imports of certain data processing machines stood at USD 553 million in the last fiscal as against USD 583.8 million in 2021-22.

Similarly, imports of micro computers/processors stood at USD 1.2 million in the last fiscal against USD 2.08 million in 2021-22.

In May, the government approved the Production Linked Incentive Scheme 2.0 for IT Hardware with a budgetary outlay of Rs 17,000 crore.

The government, in February 2021, approved the scheme for IT hardware, covering the production of laptops, tablets, All-in-One PCs and servers with an outlay of Rs 7,350 crore.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

A laptop showroom in Chennai.
| Photo Credit: The Hindu

The Directorate General of Foreign Trade (DGFT) on August 4 delayed Thursday’s notification restricting imports of laptops, PCs, tablets and servers to India ‘with immediate effect’ to November 1, after Customs officials stationed at ports of entry started holding up electronics shipments. Government officials sought to provide assurance to industry that most applicants seeking licences for import of the restricted electronics products under the new regime would receive them promptly upon filing the required application.

Two officials, who spoke on condition of anonymity, admitted that while it was not intended to have import licencing of these products impact shipments that were already on their way to India, Customs “field officers” had worked to implement the new rule immediately after it was notified by the DGFT. The government would now work to clear these shipments, the officials added.

‘Self-sufficiency’

The officials asserted that the move was an effort “to bring in self-sufficiency in electronics production,” even as they stressed that the import curbs had nothing to do with the Production-Linked Incentive (PLI) scheme for IT hardware, which represents the Government’s most significant effort to boost laptop, PC and server manufacturing in India.

When asked about the economics of local manufacturing — most IT hardware in the now-restricted category is imported from China where most major PC suppliers have manufacturing facilities — one official admitted that the response to the PLI scheme’s previous iteration had not been “as expected,”. The official added that ‘over time’ the cost of domestically produced hardware would come down, without, however, providing any timeline for this.

‘No ban’

In spite of the sweeping wording of the notification, the Government asserted that the import restrictions would not amount to a hurdle even for importers going forward. Most import licence applications from now on would be cleared within “five to 10 minutes,” one official said, with an information note pegging this timeline at 1–2 days. 

The officials did not elaborate on the criteria that would be used to reject licence applications, observing that this would be a “confidential” decision taken within the DGFT. While the Directorate, which comes under the Ministry of Commerce and Industry, had notified these changes, communications defending the licencing move have come largely from the Ministry of Electronics and Information Technology.

A few companies had already applied for import licences, one of the officials said. “This [notification] will give [firms] a signal that the government is keen on having secure devices,” an official said, without elaborating.