Saturday, August 31, 2013: A government committee is contemplating to impose basic customs duty on selected electronic hardware goods. These electronic items are not there in the obligatory zero customs duty list under World Trade Organization’s information technology pact signed in the year 1996. The panel, which is headed by the Secretary of Department of Electronics and Information Technology (Deity) is planning to modify the inverted duty structure in the electronic hardware sector.
The committee members includes commerce ministry officials. The government is planning to take this step with a view to promote domestic manufacturing of electronic hardware. Local manufacturing was facing problems due to the inverted duty structure. The duties resulted in the increase in the cost of domestically manufactured electronic items in comparison with goods imported from outside.
The move has come at a time when the current account deficit is mounting. Hence, it becomes essential for the government to decrease imports and reign in the deficit, which is resulting in weakening of rupee against the dollar. The most imported item after oil and gold is electronic goods. India is also hopeful that in this way, it may be able to garner some amount of additional revenue by imposing customs duty on selected products, but the products are too few in number, hence the collection may not be huge.
