Reports are suggesting that the Indian government is wrapping up plans to increase import duties on several products. Apparently, the new taxes will affect more than 50 items and include electronics. Moreover, it will cover electrical goods, chemicals, and handicrafts worth around $56 billion. Customers who are familiar in importing from China will be greatly affected by the newest India Import duties, but other countries will also be affected.
The latest report cites a government official, India’s Finance Minister Nirmala Sitharaman may likely make the announcement when she presents the annual budget for 2020-21 on February 1. The government will announce the new import duties along with other measures to stimulate and revive the country’s economic growth.
Two government officials familiar with the matter also disclosed the increased customs duties will affect goods such as mobile phone chargers, industrial chemicals, lamps, wooden furniture, candles, handicraft items, and jewelry. The government will increase import tariffs by 5% to 10%. That’s the recommendation from a panel of trade and finance ministry officials, among others.
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The new Import duties should not affect smartphone prices directly
The move will undoubtedly affect smartphone manufacturers that still import chargers or other components such as vibration motors and ringers. However, most of the OEMs with solid presence in India have established local manufacture. For that reason, the increase will have little to no effect on smartphone prices. Moreover, retailers such as the giant IKEA may also be affected. The retailer is in the process of expanding its footprint in India but states that Indian custom duties are a huge challenge.
According to the official, the government is “aiming at imports of non-essential items.” He believes that a hike in import duties would provide a level playing field for local manufacturers. Those are often hit by cheap imports from China. India Import Duties represents the economic protectionism in action. Let’s see how this will play for the local manufacturers. Worth noting that are small retailers in the country that resell products from China. It also represents a problem for active companies that have to import.