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Government hikes import tariffs on electronic and communication items

The move is intened to curb imports and stabilize the Rupee.

  • Published: October 13, 2018 12:25 PM IST

The Government, on Thursday, announced a hike in import tariffs on several items listed under the electronic and communication category, in order to curb imports and strengthen the Rupee. The revised tariffs will be applicable on products like wearables, Voice over Internet Protocol (VoIP) equipments, phones, and Ethernet switches. However, the actual magnitude of tariff hike on specific items hasn’t been announced yet.

After an earlier increase in tariffs of nineteen items including refrigerators, speakers, and air conditioners, this is the second time in two weeks that the government has raised import fees, on goods deemed as ‘non-essential’.

In December last year, the government had pushed higher import taxes on products like mobiles and TVs, which was followed by another such move in February of this year, when the budget was introduced. It is being speculated that the latest tariff hike may heighten trade tensions with manufacturers, as well as US and China. The constantly falling value of Indian Rupee and promotion of ‘Make in India’ program has also been highlighted as the main reason for the move.

The government’s step may also affect telecom operators such as Reliance Jio, Airtel, and Vodafone Idea, commented Neil Shah from research agency Counterpoint, while speaking to Reuters.

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Shah further added that the move may even slow down the rollout of high-speed optical fiber and LTE-based networks (like JioGigaFiber), which use electronic and communication equipment. At the same time, it may also provide a boost to local telecom equipment manufacturers like Tata Teleservices.

  • Published Date: October 13, 2018 12:25 PM IST