Govt likely to reduce import limit by 5% for laptops, tablets, PCs from 2025

In August 2023, the government proposed curbs on import of laptops and then rolled back the proposal after criticism from the industry

With an aim to boost local manufacturing, from 2025, the government may introduce small curbs on import of laptops, tablets and PCs by reducing the import limit by 5 percent, three sources with knowledge of the matter told Moneycontrol.

Currently, the Centre has extended the free import of such items till December 31, 2024. Previously, the system was scheduled to end on September 30.

Sources explained that the import data for FY 2024-2025 may be taken as the baseline for slashing the limit by 5 percent, and the measure is slated to be implemented from April 1, 2025.

The limit may be progressively raised beyond 5 percent in the following years, using FY 2024-2025 import data as the baseline for calculating these adjustments, sources explained.

However, the industry has sought more clarification from the government regarding this, and has requested it to release a notification. If implemented, this plan is expected to disrupt an industry worth $10 billion and reshape the dynamics of the IT hardware market in India, which is heavily reliant on imports.

These discussions took place in a consultation meeting that the government held with members of industry in early November. The meeting was attended by representatives of IBM, Dell, Lenovo, and also, industry associations which represent similar hardware manufacturers and Big Tech companies.

While members of the industry told Moneycontrol that they have been preparing for such an outcome over the last one year, government has assured that they want to make this transition hassle free, so that the industry is not disrupted.

"This new system will operate entirely online with no manual intervention, streamlining the import process at the customs level to ensure a hassle-free experience for importers," said a government official.

The government is said to be going ahead with this to ensure that PLI companies, manufacture from India, and also to reduce reliance on particularly geographies for import of such items  due to security reasons.

"The government wants to ensure that companies who have promised to apply for PLI, are picking up manufacturing in the country," said the official.

"There is also a significant security interest for the government here, as roughly 70 percent of these items are currently imported from China and Hong Kong," the official added.

In August 2023, the Indian government announced restrictions on the free import of laptops, tablets, personal computers, and related items. The move aimed to boost opportunities for domestic manufacturers, given India’s substantial reliance on imports of these products.

This policy initially raised concerns among global tech giants such as Dell, Acer, Samsung, Panasonic, Apple, Lenovo, and HP, who argued it would impact their operations. Following industry backlash, however, the government postponed the restrictions, allowing unrestricted imports until September 2024.

Instead of a licensing regime, the government introduced an 'import management system,' requiring IT hardware companies to register and report data related to their imports.

It is this system which was supposed to end on September 2024, and has been now extended till December 31, 2024.

On September 24, the Directorate General of Foreign Trade released a circular notifying this extension. The notification had also said that from January 1 2025, importers will have to apply for fresh authorisations, and the DGFT will release detailed instructions regarding that.