Government Revises Tech Import Rules to Foster Domestic Manufacturing

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India is revising its proposed measures on the regulation of laptop, tablet, and other IT hardware imports, allowing companies like Apple Inc., HP Inc., and Dell Technologies Inc. more time to prepare for potential restrictions. The country is eliminating the mandatory licensing requirement for technology importers and will instead require these companies to register under its import management system, according to individuals familiar with the policy who spoke on the condition of anonymity since the matter has not yet been made public. This new system is set to become operational on November 1.

India aims to stimulate domestic production while ensuring an adequate supply of consumer electronics. Last month, the government surprised companies such as Apple and Samsung Electronics by announcing plans to restrict laptop and tablet imports without the sudden requirement for a license.

Under the latest plan, all companies importing items ranging from tablets and laptops to desktop computers and servers into India will be obligated to register. However, unlike the previously contemplated licensing system, which demanded an immediate reduction in imports, the new regulations will not restrict inbound shipments for approximately six to nine months, as per the insiders.

A quota on imports may gradually come into effect as companies commence local manufacturing of laptops, tablets, and other hardware. The allocation of each company's quota will depend on its local production, importation of IT hardware, and exportation of such products from India, according to the sources. It's worth noting that these new rules do not apply to smartphones.

These adjustments are part of Prime Minister Narendra Modi's initiative to bolster domestic production and establish a top-tier technology manufacturing sector in India, in response to companies seeking to diversify their supply chains away from China. This year, India introduced a $2.1 billion financial incentive program to attract computer manufacturers to the world's most populous nation.

Companies like Dell, HP, Lenovo Group Ltd., Foxconn Technology Group, and Asustek Computer Inc. have expressed interest in availing themselves of these subsidies to manufacture laptops, tablets, and other products within India.