India has now restricted imports of Chinese colour televisions to encourage domestic manufacturing after banning mobile applications and excluding firms from China from participating in public procurement tenders, two officials with direct knowledge of the matter said.
The Directorate General of Foreign Trade (DGFT), an arm of the commerce and industry, issued a notification on late Thursday evening amending the import policy of colour television (TV) from free to restricted category.
“Import of colour TV is now in the restricted category, which would necessitate an importer to seek import license from the government. The main purpose of this move is to check influx of China TVs,” one of the officials said requesting anonymity.
India has a Rs 15,000 crore TV industry and over 36% of that is imported primarily from China and South East Asia, he added.
India has taken a series of actions against China after the violent brawl between Chinese and Indian soldiers on June 15 along the Line of Actual Control in the Galwan Valley in eastern Ladakh. Twenty Indian Army personnel were killed that day.
On June 29, the Narendra Modi government announced a ban on 59 mostly Chinese mobile applications such as TikTok, UC Browser and WeChat, citing security concerns. On July 23, it restricted public procurements by the bidders from countries that share a land border with it on the ground of national security.
A second official said that some Chinese TV sets were routed through a third country with which India has a free trade agreement (FTA). “This move will also curb such illegal trade,” he said.
Besides China, Vietnam, Malaysia, Hong Kong, Korea, Indonesia, Thailand and Germany are major exporters of colour TVs.
“Many such items enter Indian market taking advantage of ASEAN India FTA imports at reduced or zero duty, putting our domestic industry at a disadvantage. Such imports cannot be controlled through increased duty rates. Hence, the government is taking measures such as non-duty actions like import restrictions,” the first official cited above said.
ASEAN FTA was signed during the United Progressive Alliance (UPA) regime in 2009 with Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
India has created necessary infrastructure and made arrangements to produce electronic items in cost-effective manner under the Atmanirbhar Bharat Abhiyan (Self-reliant India Imitative), and invite global manufacturers to set up units in India, the second official said.
India’s production of electronics grew from $29 billion in 2014 to $70 billion in 2019.
“Phased Manufacturing Programme (PMP) for TVs is underway and specified parts like open-cell, chips on films, Printed Circuit Boards Assembly (PCBA ) are exempted from duty. Hence, India is ready for a shift of manufacturing to India with cost-effective imports of essential parts,” the first official said.
The officials said Thursday’s decision to restrict the influx of TV sets was taken after extensive consultations with the domestic industry that aims to promote ‘Make in India’, create jobs and provide goods at a comparable rate to the consumer.
“As there is no ‘ban’ and only a ‘restriction’ being imposed, there is a possibility of such imports; however, with prior approval of the Directorate General of Foreign Trade,” Divakar Vijayasarathy, the founder and managing partner at consultancy firm DVS Advisors LLP, said.
“The procedural aspects of acquiring this permit [licence]; however, would be tedious considering the stakes involved. There shall be transition provisions in place for import orders already being given or goods in transit,” he added.
