By Raju Vernekar
Mumbai, Sept. 22:
With the Union Government set to re impose 5 per cent customs duty on import of Open Cell panels for television sets, the new TV sets are expected to be costlier from first October onwards, official sources said.
The government had imposed a 5% duty on open cell panels in March, 2018, which was withdrawn on the request of the domestic television manufacturers who wanted some time to develop their own production capacity within India. The same duty was applicable on open cell earlier as well, but the government had decided to give one year exemption to makers, allowing them time to build capacity. The exemption period ends on September 30 and there are no plans to further extend it. Open cell remains to be a key component for television makers.
No real manufacturing growth of television could happen unless Open Cell is domestically made. The present activity carried out by the industry is only of assembly of television after importing most of the parts. The move is believed to be elemental to the Phased Manufacturing Plan (PMP) of television and its components to bring the industry out of mere television assembling while being totally dependent on imports for all its parts.
Basically TV components are imported from China by different manufacturers. LG manufactures TV at its plants in different countries including China and India. Accessories are made in Korea and China and then the components are delivered to the assembly plants.
Till last year televisions worth Rs 7,000 crore were being imported. The government has supported the television industry through custom duty structure. A customs duty of 20 per cent is being imposed on imports of television since December 2017. Television import has already been put on the restricted category with effect from July end this year. Television manufacturers are enjoying full reasonable protection from imports.
While the move aims to boost local manufacturing and make televisions affordable, the prices are likely to go up as an immediate impact. The prices may go up by a minimum of Rs 600 for a 32-inch television and Rs 1,200-1,500 for a 42 inch TV and even higher for a large screen television. Off late the prices of open-cell have increased rapidly from the supply end with also extreme shortage in its availability. The leading brands are believed to import Open Cell for a basic price of Rs 2,700 for a 32-inch and about Rs 4,000 to Rs 4,500 for a 42-inch television.
Basic customs duty exemption on import of open cell for manufacturing television panels was introduced to boost local manufacturing of television in India. Now, the focus seems to build capacity for manufacturing of television components in India. Discontinuation of exemption is a measure towards import substitution and promotion of domestic manufacturing.
On July 30, 2020, the import of colour TV seats was banned by putting the colour TV from “free” to “restricted” category by the Directorate General of Foreign Trade (DGFT). The restricted items include: TV set of screen size up to 36 cm, TV set of screen size exceeding 36 cm but not exceeding 54 cm, TV set of screen size up exceeding 54 cm but not exceeding 68 cm, TV set of screen size up to exceeding 68 cm but not exceeding 74 cm, TV set of screen size exceeding 74 cm but not exceeding 87 cm, TV set of screen size exceeding 87 cm but not exceeding 105 cm and TV set of screen size exceeding 105 cm. The Liquid crystal display TV set of screen size below 63 cm.
