India Will Not Impose Licensing Requirement on Imports of Laptops and Computer systems

India won’t impose the licensing requirement on imports of laptops and computer systems however will solely monitor their inbound shipments, a prime authorities official stated. 

The remarks assume significance as the federal government in August introduced that these merchandise, together with laptops, tablets and computer systems, can be put underneath licensing regime from November 1.

“On laptops, we are of the view that there are no restrictions as such. We are only saying that somebody who is importing these laptops, have to be under close watch, so that we can look at these imports.

“It is mainly monitoring, which we’re doing. It has nothing to do with restrictions as such,” Commerce Secretary Sunil Barthwal told reporters here.

Explaining further, Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi said there will be an import management system, which will come into place from November 1.

The work is in progress and hopefully it will be in place before October 30, he said.

While the IT hardware product industry comes under MeitY, the DGFT notifies decisions with regard to import/export of a product.

Following this notification, IT hardware industry had flagged concerns.

“It will likely be extra within the nature of an import administration system the place individuals will likely be issued an authorisation. It will likely be a really mushy licensing. It will simply be an authorisation,” one of the sources said, adding that everything will be online.

A company will be able to put up a request for imports of certain numbers and it would get the authorisation for imports.

According to the source, the DGFT may also have to issue a clarification on its earlier notification (dated August 3) which has stipulated a licensing regime for imports of these goods.

The order issued in August had put licencing requirements with immediate effect and later, amendments were made, and a transition period was provided till October 31.

The restrictions are also there on micro computers, large or mainframe computers, and certain data processing machines.

India already has an import monitoring system for certain products like steel, coal and paper.

The licensing conditions on imports were put on the grounds of security and to spur domestic manufacturing of these products.

While announcing the licensing rules the government had also said that it wants IT products to come from “trusted sources”.

According to a report by think-tank Global Trade Research Initiative (GTRI), India is critically dependent on China for day-to-day use and industrial products like mobile phones, laptops, components, solar cell modules, and ICs.

The government has taken several steps to boost domestic manufacturing of electronic items such as rolling out of the production-linked incentive scheme and increasing customs duties on the number of electronic components.

Leading electronic brands which are sold in the market include HCL, Samsung, Dell, LG Electronics, Acer, Apple, Lenovo and HP.

India imports about $7-8 billion (nearly Rs. 58,300 crore – Rs. 66,630 crore) worth of these goods every year.

The country has imported personal computers, including laptops, worth $5.33 billion (nearly Rs. 44,390 crore) in 2022-23 as against $7.37 billion (nearly Rs. 61,380 crore) in 2021-22.

Imports of certain data processing machines stood at $553 million (nearly Rs. 4,600 crore) in the last fiscal as against $583.8 million (nearly Rs. 4,860 crore) in 2021-22.

Similarly, imports of micro computers/processors stood at $1.2 million (nearly Rs. 10 crore) in the last fiscal against $2.08 million (nearly Rs. 17 crore) in 2021-22.

In May, the government approved the Production Linked Incentive Scheme 2.0 for IT Hardware with a budgetary outlay of Rs. 17,000 crore.

The government, in February 2021, approved the scheme for IT hardware, covering the production of laptops, tablets, All-in-One PCs and servers with an outlay of Rs. 7,350 crore.