TV makers turn to imports to cut costs: Report
The vital component of a television set has a 5 percent custom duty while finished products are cheaper to import from FTA countries
July 08, 2019 / 03:34 PM IST
India's Free Trade Agreements (FTA) with various countries may end up denting the Make in India initiative, especially in the television sector, as per an Economic Times report.
Importing is more lucrative for TV makers as Budget 2019 did not reduce the 5 percent import duty on open TV panels, which alone make up 70 percent of the total device cost, the paper noted.
While the duty was cut from 10 percent in March 2019, experts told the paper that no tax would benefit the domestic manufacturing segment. India does not have TV panel manufacturing plants and as it stands now, finished sets imported under FTA from ASEAN countries negates the component tax.
Popular brands such as Sony already source their TV sets from Thailand, while Samsung is bringing their products in from Vietnam. China, Malaysia, Hong Kong and Taiwan are the other likely sources.
The FTA coupled with lack of a Phased Manufacturing Programme (PMP), which would enable a value chain eco-system from component to finished product, has pushed imports in FY18-19 by 45 percent, it added.
Industry body, the Consumer Electronics and Appliances Manufacturers Association (CEAMA), has requested that the government implement PMP to boost domestic manufacturing.