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Updated 17:17 IST, February 1st 2025

Union Budget 2025: Government Slashes Tariff on PCBAs, Other Mobile Phone Components

The assembly of PCB will no longer attract any tariffs, according to the latest Budget.

Reported by: Shubham Verma
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PCBAs and other mobile accessories have no tariffs in the budget. | Image: Reuters

Finance Minister Nirmala Sitharaman 's 8th budget spanned across sectors, including electronic goods where the proposed tariffs on printed circuit board assemblies are zero. While the minister did not mention the reduction at Parliament, her 60-page speech has revealed that the tariffs on PCBAs, camera modules, connectors, materials used in the manufacturing of wired headsets, microphones, receivers, USB cables, fingerprint readers, and sensors of cellular mobile phones have been slashed from 2.5 per cent to nil.

According to experts, the removal of the 2.5 per cent basic customs duty (BCD) on major mobile phone components and accessories will give a fillip to local electronics manufacturing. “The rationalisation of tariffs on key inputs and components creates a more competitive cost structure and encourages deeper integration with global value chains,” said Pankaj Mahindroo, Chairman of India Cellular and Electronics Association (ICEA).

According to Mahindroo, the 2.5 per cent levy could not result in expanded domestic manufacturing but led to an increase in costs. “The removal will enable manufacturing, remove ambiguity, and increase the competitiveness of manufacturing,” he added.

In her speech at Parliament, Sitharaman also announced the BCD on Interactive Flat Panel Display (IFPD) — the market of which is currently valued at over ₹7,000 crore — will be hiked from 10 per cent to 20 per cent to boost local manufacturing of televisions and remove the inverted duty structure.

On the other hand, tariffs on open Cell, a thin-film transistor (TFT) crystal display that accounts for roughly 60 per cent of a TV's overall cost, have been reduced. However, the proposed reduction in BCD on Open Cell has received mixed responses from the industry, with some hailing it as a move to promote local production of display modules for LED TVs and some criticising the move as it would create an uneven playing field for manufacturers.

Published 14:36 IST, February 1st 2025