ICEA Appeals to IT Ministry Over Import Licensing
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| 1. Concerns Raised by ICEA | The India Cellular and Electronics Association (ICEA) has written a letter to the IT Ministry, requesting the government to rethink its decision on import licensing requirement accompanied by a quota, which was extended by 3 months until October 31, fearing that this may lead to price rise in consumer electronics products as companies are not yet prepared for manufacturing PCs, laptops and servers domestically at scale. |
| 2. Hoarding and Market Distortion | In the letter sent to Alkesh Kumar Sharma, Secretary, MeitY, on August 22 and seen by IANS, Pankaj Mohindroo who is the Chairman of ICEA wrote that an overarching factor that should be taken into consideration in “avoiding supply chain disruption till domestic production ramps up” is that any “reduction in supplies or even an indication will lead to hoarding and market distortion”. This, in turn, can push up consumer prices, “which will adversely impact not just key stakeholders such as students, but also those who are the core of growing the digital economy, i.e. start-ups, IT and ITES firms, BPOs,” he said. “It is critical that we ensure an uninterrupted supply for at least a year, till such time we can build up domestic capacity,” Mohindroo noted. |
| 3. Request for a Breather | The ICEA pitched that the industry seeks at least nine-month breather after the PLI for IT Hardware was launched. “The government may undertake a re-assessment of the investment pipeline and the supply situation before inviting the industry to discuss whether any further policy intervention is needed at that stage. It may be too early to assess the full implication of the new scheme before then,” according to the ICEA letter. Where servers are concerned, the ICEA has received inputs that companies in that sector seek a relook at their inclusion in the proposed intervention. “Overall, we will request the government to layer any intervention in a manner that works well for the industry as a whole, since individual companies are differently placed, at varying degrees of investments and products at this stage,” the letter read. |
| 4. Import Restrictions | The Central government earlier deferred its decision to restrict the import of certain categories of laptops and computers until November 1, allowing companies three-months time to import these devices. Post November 1, no entity will be allowed to import laptops, computers, and related items without a license. According to the ICEA, a “one size fits all approach” will need reconsideration by the government. |
| 5. Industry Appeal | Earlier this month, top consumer electronics companies like HP, Apple and Dell urged the government to extend the November 1 deadline for the licenses required for PCs, laptops, and tablets by at least and year, as it will take time to configure and set up manufacturing/assembling units as per new guidelines. |
| 6. PLI 2.0 for IT Hardware | The PLI 2.0 for IT hardware has garnered applications from 40 companies including global and domestic, according to the ICEA. Union IT Minister Ashwini Vaishnaw said on Wednesday that 32 companies like HP, Dell, Lenovo, Foxconn, Acer, and Thomson, among others, have applied under the PLI 2.0 scheme for IT hardware. The expected incremental production under the scheme is around Rs 3.35 lakh crore, according to the minister. Several domestic companies such as Dixon Technologies, VVDN, and Netweb are among the applicants under the 2.0 scheme for IT hardware. |
“It is critical that we ensure an uninterrupted supply for at least a year, till such time we can build up domestic capacity,” Mohindroo noted.
The India Cellular and Electronics Association (ICEA) has expressed concerns over the recent decision by the government to extend the import licensing requirement, along with a quota, until October 31. In a letter addressed to Alkesh Kumar Sharma, the Secretary of the Ministry of Electronics and Information Technology (MeitY), ICEA Chairman Pankaj Mohindroo highlighted the potential consequences of this decision on the consumer electronics market.
Concerns Raised by ICEA
ICEA’s primary concern is that the extension of the import licensing requirement could lead to a price hike in consumer electronics products. The association argues that many companies are not yet fully prepared to manufacture PCs, laptops, and servers domestically at the required scale. This lack of domestic production capacity could result in a shortage of these essential electronic devices, driving up their prices.
ICEA Chairman Pankaj Mohindroo emphasized the importance of maintaining an uninterrupted supply chain to avoid market disruption. He stated, “Any reduction in supplies or even an indication will lead to hoarding and market distortion.” Such disruptions could not only affect students but also have adverse consequences for key players in the digital economy, including start-ups, IT and ITES firms, and BPOs.
“It is critical that we ensure an uninterrupted supply for at least a year, till such time we can build up domestic capacity,” Mohindroo noted.
Mohindroo stressed the need for a continuous supply of electronic devices for at least a year to allow the industry to develop domestic manufacturing capabilities. ICEA suggests that the government should provide a nine-month breather after the launch of the Production-Linked Incentive (PLI) scheme for IT Hardware. This pause would allow for a reassessment of investment pipelines and supply situations before considering further policy interventions.
Import Restrictions and Industry Appeal
The central government had previously postponed its decision to restrict the import of certain categories of laptops and computers until November 1, providing a three-month window for companies to import these devices without licenses. After November 1, entities will be required to obtain licenses to import laptops, computers, and related items. However, ICEA suggests that a “one size fits all approach” may not be suitable and needs reconsideration.
Several leading consumer electronics companies, including HP, Apple, and Dell, have called on the government to extend the November 1 deadline for licenses for PCs
, laptops, and tablets by at least one year. They argue that configuring and setting up manufacturing and assembly units in compliance with the new guidelines will require additional time.
PLI 2.0 for IT Hardware
The Production-Linked Incentive 2.0 (PLI 2.0) scheme for IT hardware has attracted applications from 40 companies, both global and domestic. Union IT Minister Ashwini Vaishnaw revealed that 32 companies, including HP, Dell, Lenovo, Foxconn, Acer, and Thomson, have applied for the PLI 2.0 scheme. The expected incremental production under this scheme is estimated to be around Rs 3.35 lakh crore.
Notably, domestic companies such as Dixon Technologies, VVDN, and Netweb are among the applicants under the PLI 2.0 scheme for IT hardware. The government’s decision to extend the import licensing requirement and the subsequent appeals from industry leaders highlight the complex challenges facing the consumer electronics and IT hardware sectors in India.
This story has not been edited by Smartkhabrinews staff and is published from a syndicated news agency feed – IANS