India’s PC Manufacturing Capacity Underutilised Up To 80% As Per Industry: Prasad

The industry estimates that manufacturing capacity of personal computers in India is underutilised to the tune of about 80 percent due to “cheaper imports and certain disabilities”, Parliament was informed on Wednesday.

According to the Manufacturers Association for Information Technology (MAIT), the manufacturing capacity of personal computers in the country is underutilised to the extent of about 80 per cent on account of cheaper imports and certain disabilities which render domestic personal computer manufacturing uncompetitive on account of lack of level playing field vis-à-vis competing nations, Minister for Electronics and IT Ravi Shankar Prasad said in a written reply in the Lok Sabha.

The hurdles include lack of adequate infrastructure, domestic supply chain and logistics, high cost of finance, inadequate components manufacturing base and limited focus on Research and Development by the industry, the minister added.

India has implemented zero import duty regime on 217 tariff lines, including personal computers, as a signatory to the Information Technology Agreement of the World Trade Organization (WTO), he said.

Prasad, however, pointed out that with various initiatives including Phased Manufacturing Programme (PMP) and more-recently National Policy on Electronics 2019, India has rapidly started attracting investments into this sector and mobile phone manufacturing has emerged as a flagship sector in the electronics manufacturing space.

The minister also outlined steps initiated by the government for promotion of domestic electronics manufacturing industry and exports from the country, including infrastructure facility for electronics sector.

“In 2018-19, the production of cellular mobile phones reached approximately Rs 1,70,000 crore, compared to Rs 18,900 crore in 2014-15. The production of mobile phones in volume terms reached 29 crore units in 2018-19, as compared to production of 6 crore units in 2014-15,” he said.

To another question, Prasad said that the imports of mobile phones attract basic customs duty (BCD) of 20 per cent and there is no proposal under consideration of the government to levy additional duty on import of mobile phones.

However, BCD is being imposed on the specified sub-assemblies and parts of mobile phones, in accordance with the phased manufacturing programme (PMP).

The notification of PMP has enabled the mobile phones and related sub-assemblies/ parts manufacturing industry to plan their investments in the sector, the Minister said.―Outlook India