IT hardware companies: Defer laptop import curbs by 9-12 months - The Economic Times

Apple, Dell, HP, Acer and others have sought an extension of nine months to a year of the deadline for licences required for import of laptops, tablets, all-in-one-personal computers and other items, people familiar with the matter said.
In a meeting with senior ministry of electronics and information technology (MeitY) officials on Tuesday, executives of these companies said they would need this time to set up manufacturing facilities in India.

“The companies need reasonable time to set up manufacturing. We are also unsure about the process for licensing, and the data needed from us. So, we will need this time,” one of the industry executives present at the meeting said.
The government said last week that a licence will be needed for the import of laptops, tablets, all-in-one-PCs, ultra-small factor computers and servers effective immediately. A day later, following a meeting of electronics company executives with senior officials from IT ministry as well as Directorate General of Foreign Trade (DGFT), the government gave industry time until October 31.

“For clearance of import consignments with effect from November 1, 2023, a valid licence for restricted imports is required,” the DGFT said, announcing the extension. These imports are allowed freely at present.
Representatives of the major hardware companies as well as those of the lobby groups Manufacturing Association of IT Hardware (MAIT) and the India Cellular and Electronics Association (ICEA) attended the closed-door meeting, the people said.
Apple, Dell, HP and Acer didn’t respond to queries.

The government assured the industry that the import licensing norms for specified electronics items were not to discourage or ban imports but to minimise them and look at ways of promoting exports from India by augmenting domestic manufacturing capabilities, officials said.

Apart from foreign original equipment manufacturers (OEM), government officials also met senior executives from Indian OEMs and sought details of their production capacity and the time needed to ramp up, the people said.

In days to come, the IT ministry is also likely to ask foreign OEMs to give an estimate of how many units of high-end electronic items they are likely to import over the next year, especially after November 1, the official said.“The idea is to understand the volumes and then look at the best possible ways for these imports to flow smoothly into India,” the person said.

A key demand of the industry is not to restrict the import of high-end IT hardware such as top-of-the-line laptops and PCs, since there is no capacity for the local manufacture of those products yet.

“We did not discuss the process of acquiring the licence in this meeting. That was perhaps not the intent of this meeting, and there could be separate consultation meetings regarding that because now we have time,” said an executive who attended the meeting.

MAIT and the ICEA will also write to their members seeking inputs on the process to acquire licences, sources said. These will be compiled and sent as recommendations to the IT ministry as well as the DGFT.

“Import of TVs and air conditioners, which are also similarly restricted, has a process in place to apply for the licence. If IT hardware companies require any changes from that set process, we will discuss them with the government,” another executive said.

Some of the companies also highlighted problems faced after the DGFT’s notice last week announcing restrictions.

“The notification had said shipments enroute would be cleared. But from August 4, a day after the DGFT notification came, all shipments were being stopped. There was no custom clearance happening till almost late evening of August 5,” an industry executive said.

The government downplayed the concerns.

“All these companies already have very well-oiled mechanisms for imports and know the process to get shipments cleared. We have, however, assured them of all help,” said an official.

The country imported IT hardware products worth $8.8 billion in FY23, with China accounting for more than half at $5.1 billion, followed by $1.3 billion from Singapore.

The government expects import licensing to encourage local manufacturing with the production-linked incentive (PLI) scheme for IT hardware acting as a sweetener.

ET on Monday reported that laptop and tablet sales surged up to 25% over the weekend from a week earlier amid concerns about shortages and price hikes after November 1 when the licensing requirement kicks in.

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