Govt extends import regime for IT hardware till Dec 31

Shreya Nandi/Business Standard

The Centre on Tuesday extended the import management system for laptops and other IT hardware products by three months -- till December 31 -- and asked companies to seek fresh approvals for imports from January 1, based on the new guidelines.

The existing system is valid only till September 30.

'Importers would be required to apply for fresh authorisations for the period from 1.1.2025, subject to detailed guidance to be provided shortly,' said a Directorate General of Foreign Trade (DGFT) notification.

The import management system had kicked in on November 1, 2023, to promote domestic manufacturing of these goods.  It was also to reduce dependence, especially on China, and ensure a trusted supply chain for electronics in the country.

Last year, the government had also said that the import data will be closely studied, before taking a decision on how to take it forward. The system covers laptops, tablets, all-in-one personal computers, ultra small form factor computers and servers.

In August last year, the government had announced that it plans to issue licences for import of IT hardware products.

However, amid massive reservations from firms, industry lobby groups and key trade partners, India stepped down from its earlier plan and a new 'contactless' import management system was introduced in November 2023. Under the system, the import permit is issued in an end-to-end online format.

Experts and the industry, however, raised concerns regarding the decision.

Kumar Deep Banerjee, country director of the Washington-based IT lobby group ITI Council, said the industry needs more clarity on the proposed new import authorisation scheme, set to be in place from January 2025.

"We expect a robust stakeholder consultation before implementing any new requirements," Banerjee said.

"Indias repeated delay in implementing laptop import restrictions, likely influenced by the United States' concerns, needs to end. And it's time for India to enforce these measures and boost local production," said Ajay Srivastava, founder of the Delhi-based think-tank Global Trade Research Initiative and former trade ministry official.

According to Srivastava, such restrictions would push American tech giants like Apple, Dell, and HP, which manufacture in China, to set up operations in India.

"The US's stance on China is inconsistent. It imposes tariffs and restrictions on Chinese goods like solar cells and electric vehicles to protect its own interests. But it resists when other nations take similar steps that might affect American companies," Srivastava said.

"India has a strong case for building its own laptop manufacturing capabilities. China controls 81 per cent of the global PC and laptop market, and any disruption there could have global repercussions."