After lots of discussions/negotiations with the IT Hardware Industry, the Government said that it only wants to monitor the import of IT goods and not restrict them from imports.
In the end however it appears that the import license/authorisation will indeed be needed for imports of IT Goods. DGFT has issued a Notification and a Policy Circular both Dt. 19th October 2023 to give effect to this.
While the policy circular is named as “Implementation of Import Management Systems for IT Hardware”, it essentially is for implementation of Import Authorisation System. The notification also more or less confirms the restriction policy. The online application form was also provided in the Restricted Import section and made operational only a couple of days back. Both the policy circular and notification though provide relaxation in a few more obvious types/purposes of IT imports that would not need a license/authorisation.
The approvals are expected to be faster for the initial applications. They may however become slower later. The Government is likely to closely monitor the value and volume of imports by specific companies, the category of IT goods being imported, total imports in the country etc. Depending upon the situation, further course of action would be decided.
In future, these import authorizations are likely to be granted based on three key criteria: the previous year’s import value or the average from the past three years for IT products, the extent of domestic manufacturing of IT hardware devices, and the volume of electronic goods exports.
The exemption from Import license/authorisation provided in various circulars/notification are summarized as below:
Background
On August 3, 2023, suddenly the Directorate General of Foreign Trade (DGFT) issued a notification, imposing immediate restrictions on the import of laptops, tablets, personal computers (PCs), and other electronic items falling under the HSN 8741 category citing security reasons.
The government’s decision was commendable as it would encourage the production of these products within India. However, the announcement of this decision was disorganized, resulting in the hindrance of the clearance process for goods that had already arrived. Consequently, in response to concerns from the IT industry and to facilitate a smoother transition, the government has postponed the implementation of import restrictions until November 1, 2023. During this period, import shipments of the specified items can be cleared without requiring a license for restricted imports.
Impact on the Electronics Market:
According to media reports, the decision to introduce a licensing regime for laptops, tablets, and PCs was primarily due to security reasons. Additionally, it aimed to promote domestic manufacturing and reduce dependence on imports, especially from countries like China and Korea. Major foreign players might encounter challenges and could be required to adjust their pricing or profit margins to maintain competitiveness in the Indian market. On the other hand, this move presents an opportunity for local manufacturers to capitalize on the increasing demand for indigenous products.
The government’s decision to defer the implementation of import restrictions is a welcomed relief for businesses seeking to adapt to the new regulations. As your trusted EXIM consultancy partner, we are committed to offering you timely updates, expert guidance, and comprehensive solutions to ensure a smooth transition.
Andees team very well understands the complexities of international trade regulations. Our team of experts are here to guide and support you in navigating the new import restrictions effectively. We can assist you in obtaining the necessary licenses and permits from the DGFT and other relevant authorities, ensuring compliance with trade regulations.
For any inquiries or assistance related to import regulations, licensing, or compliance regarding the import of laptop servers, etc., please feel free to contact us. We are here to serve you and contribute to your growth in the Indian market.
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