Could lower import costs accelerate electronics manufacturing? India has removed customs duty on key component inputs to encourage local production, investment, and supply chain resilience.
The government has exempted basic customs duty (BCD) on specified goods used in manufacturing display assemblies, lithium-ion cells, and inductor coil modules, aiming to strengthen domestic production of electronic devices such as smartphones, laptops, wearables, and smart televisions.
On July 9, 2026, the Ministry of Finance issued three separate notifications implementing the exemptions for goods used in producing these critical electronic components. The move forms part of the government’s broader efforts to expand domestic electronics manufacturing under the production-linked incentive (PLI) scheme and reduce reliance on imported components.
According to the notifications, the customs duty exemption on inputs used in display assemblies and inductor coil modules will remain in force until 31 March 2029.
The duty relief extends beyond consumer electronics. Display assembly inputs covered under the exemption can also support manufacturing for automotive, medical and industrial applications. On the other hand, inductor coil modules are widely used in wireless charging systems incorporated into modern electronic devices.
The revised customs regime is also expected to support sectors that rely on lithium-ion cell technology, including electric vehicles (EVs), battery energy storage systems, renewable energy, telecommunications infrastructure, data centres, medical devices, drones and industrial automation.
Industry experts said the policy also simplifies the customs regime for lithium-ion cell manufacturing.
Pankaj Mohindroo, chairman of the India Cellular and Electronics Association (ICEA), said expanding the duty exemption to automotive, medical and industrial display assemblies could help develop manufacturing capacity in these segments.
He also stated that exempting capital goods for lithium-ion cell manufacturing across sectors is expected to improve the industry’s competitiveness and support faster expansion of domestic manufacturing.
