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India Mandates Licensing for Laptop, Tablet Imports in Blow to Technology Companies.

With immediate effect, India has announced that it will require a licensing process for the import of laptops, tablets, and personal computers. This decision is anticipated to have a significant impact on technology companies, potentially compelling them to enhance local manufacturing efforts. Previously, India allowed the free import of laptops, but the new rule establishes a requirement for a special license, similar to the restrictions imposed on TV shipments in 2020.

Industry executives have expressed concerns about the licensing regime, as it could result in longer wait times for the launch of new models, particularly ahead of India’s festive season when sales typically experience a surge. Although the government did not provide a specific reason for this move in its notification, India’s Prime Minister has been actively promoting local manufacturing and discouraging imports through his “Make in India” initiative.

In the April to June period, India’s electronics imports, encompassing laptops, tablets, and personal computers, reached $19.7 billion, indicating a 6.25% year-on-year increase. According to research, India’s laptop and personal computer market is estimated to have an annual worth of $8 billion, with approximately two-thirds of these devices being imported.

An economist suggests that the intent behind this action is to reduce heavy dependence on imported goods and substitute them with domestically manufactured products. Additionally, a government source, who opted to remain anonymous, shared that ordered shipments will be allowed without licenses until August 31.

Contract manufacturers are expected to benefit from this move, as evidenced by a more than 7% increase in their share prices following the news.

India has also extended the deadline for companies to apply for a $2 billion incentive scheme aimed at attracting investments in IT hardware manufacturing. This scheme is pivotal to India’s ambition of becoming a major player in the global electronics supply chain, with a target of achieving annual production worth $300 billion by 2026. In the past, the country has employed high tariffs on products like mobile phones to stimulate domestic output.

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