Broadband India Forum (BIF) has approached the Department of Telecommunications (DoT) and the finance ministry seeking reversal of hike in import duties on components and PCBAs that was introduced in recent the Budget announcement.

As per BIF, the move will drive up the cost of making telecom products and may offset benefits of PLI scheme.

To this end, BIF has written to the government urging withdrawal of the said duties and pushed for continuation of the duty exemption on telecom components.

In its letter to the finance secretary, BIF noted that duty increase in components has resulted in significant increase in the cost of production. BIF also highlighted that since significant investments into the sector are hinging upon the successful uptake of the PLI policy, the government needs to quickly address the issue.

As per sources, the industry has made two sets on submissions on the issue to the government. One submission was made on March 1, 2021 and another was made on March 22, 2021.

According to BIF, this duty increase has come on top of the removal of export incentive (MEIS) and is impacting the cost competitiveness of Make in India products.

As such, despite the government push for Make-in-India under the Aatmanirbhar Bharat mission, telecom products made in India will, as a result of the recent move, become costlier than the finished products imported from FTA countries.

Further, BIF noted that import of printed circuit board assembly (PCBA) for telecom manufacturing is also now facing a duty of 11 per cent.