Ahead of the upcoming Union Budget, the Indian Cellular and Electronics Association (ICEA) has raised concerns about the export growth of mobile devices, advocating for a reduction in tariffs on imported components.

The ICEA asserted that a cut in tariffs for imported components could result in a significant boost to the industry, predicting an incremental production surge of 33%, accompanied by a 44% increase in exports. Further, the body said this growth could lead to the creation of around 30 lakh jobs by the fiscal year 2027.

Highlighting the current state of domestic manufacturing, the ICEA emphasised that the industry has successfully met the demands of the domestic market. However, any additional production should be directed towards exports, necessitating a policy shift towards export-led growth, it said.

Addressing the cost dynamics, the ICEA contended that mobile manufacturing in India is operating at a disadvantage of approximately 6% compared to Vietnam, and 7% compared to China. The association attributed this discrepancy to high tariffs, asserting that these tariffs are impeding India’s export competitiveness in the global market.

Further, the ICEA claimed that the existing tariffs on imported customs are not only hindering export potential but are also negatively impacting domestic demand. According to their estimates, the additional tax burden imposed by these tariffs ranges from 7-9%, exacerbating the challenges faced by the industry.

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