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Kolkata: Mobile phone manufacturers constitute on the of the most important part of the Indian manufacturing firmament. Based on data pertaining to 2025 calendar year, mobile phones accounted for about two-thirds of India's total electronics exports. Cellphone manufacturers have urged the finance ministry to reduce customs duty parts of mobile phone such as PCBS (printed circuit boards), microphones and wearables.
The manufacturers have also sought tariff revision on capital goods and other components so as to reduce the cot of handset manufacturing. production cost, industry body ICEA said in its budget recommendations. India Cellular and Electronics Association (ICEA), which asked for the reliefs, include Apple, Foxconn, Dixon, Xiaomi, Vivo, and Oppo. ICEA has pitched their wishlist as an enabler of a self-reliant and globally competitive capital equipment ecosystem in India.
The plea of the industry body seems to have been triggered by the recent restrictions by China which could impact production of mobile phones in India. "With China's recent export restrictions on manufacturing machinery increasing supply-chain risks, India's dependence on imported equipment has become a strategic vulnerability. It is, therefore, recommended that the government extend the existing zero-duty benefit on capital equipment to all constituent components, sub-assemblies, and assemblies imported specifically for their manufacture," ICEA said.
ICEA pointed out that certain critical and specialised machinery required for mobile phone and lithium-ion cell manufacturing remain outside the scope of existing customs duty exemption notifications. This pushes up project costs of mobile phone manufacturing. The industry body has also said that machines are custom-built for lithium-ion cell and mobile phone manufacturing. These machines are not manufactured in India and are subject to import duty which pushes up capex by 7.5–20%.
"Global supply constraints and China’s export restrictions on key battery materials have heightened the urgency to build self-reliant domestic capacity. Extending exemptions will lower setup costs, accelerate commissioning, enhance export competitiveness, and create employment across the energy-storage ecosystem," ICEA has mentioned.
The India Cellular and Electronics Association has forecast that mobile phone of $75 billion or about Rs 6.76 lakh crore can be produced in India this financial year. In FY27, mobile phone exports can surpass $30 billion or about Rs 2.7 lakh crore. In FY25, phones worth 5.5 lakh crore were produced in India and exports touched Rs 2 lakh crore. According to industry estimates has also cited the employment generating potential of the electronics sector which is believed to employ in excess of 25 lakh people.
ICEA has requested the government for import duty on PCBs to be revised. PCBs account for 10-15% of the cost of a phone and if this price goes down, the phone swill be more competitively priced. It has also urged the government to rationalise the tax structure for the display or the screens used by various devices and this includes the screens on automobile dashboards. The industry body has also asked for reduction of basic customs duty on finished wearables and hearables. This extent of reduction is from the existing 20% to 15%.
