In Union Budget 2020 Goods and services tax on smartphones was increased to 18 percent. Now ICEA (India Cellular and Electronics Association) has asked government to reduce the GST on mobile phones from the current 18 percent to 12 percent at the upcoming Budget 2022. This will not only help the domestic manufacturers.
The ICEA proposed local producers will benefit massively from the allocation of Rs 1,000 crore of Indian manufacturers. This comes with another proposition that requests the government to offer hobby subvention of 5% on loans up to Rs 1,000 crore. It stays to be visible whether or not the government obliges them in the approaching price range. At the cease of the day, there are a number of expectations in the upcoming budget consultation to rationalise the responsibility and GST for the cellular enterprise as it is the handiest affordable way in ensuring a digital India.
The Indian government is aiming towards ‘Digital India’ but for this to happen, smartphones should be made accessible primarily since there’s very little that we cannot do on a smartphone these days. At this juncture, it’s only rational to expect a lenient approach towards the mobile industry from the Union Budget 2022.
Production Linked Incentive was introduced by the Indian government during the COVID-19 pandemic in a way to fill the gap between Indian manufacturing and China/Vietnam. However, that didn’t seem to have helped considering the contribution of Indian mobile companies to global production has dropped from 47 percent in 2016 to 8 percent currently.
