The Union Budget 2025 announced the abolition of basic import duty on certain smartphone parts, aiming to enhance domestic manufacturing and reduce production costs in India’s mobile phone industry. This move is expected to support the Make in India initiative and encourage technology companies to expand local production.
Union Budget 2025 scraps import duties on select smartphone parts to boost local manufacturing and reduce costs in India’s mobile phone industry.
In a significant policy move unveiled during the Union Budget 2025 presented on February 1, the Government of India announced the removal of basic import duties on select smartphone components. This change aims to boost domestic mobile phone manufacturing, lower production costs, and strengthen India’s position as a global hub for electronics manufacturing.
The duty abolition covers key smartphone parts including printed circuit boards, camera lenses, and other essential components. By eliminating these basic customs duties, manufacturers will be able to import parts at reduced costs, potentially resulting in more competitively priced mobile devices for consumers.
“This measure is intended to support the Make in India initiative by enabling greater ease of manufacturing and attracting more global mobile phone companies to expand their production footprint in India,” a senior government official said on the condition of anonymity. The government has been focusing on reducing import barriers in the electronics sector to promote self-reliance and enhance export capabilities.
India’s smartphone market, one of the fastest-growing globally, has seen major investments from domestic and international brands over the past decade. However, the high cost of imported components has been a challenge for manufacturers aiming to increase local assembly and production.
Industry experts have welcomed the budgetary announcement. Rajiv Mehrotra, an analyst at TechInsights India, commented, “Removing basic import duties on key smartphone parts significantly lowers input costs. This can accelerate production scale-ups and innovation within India’s smartphone ecosystem.”
The move also aligns with India’s broader objective to increase local value addition in electronics manufacturing, reducing dependency on imports and strengthening the supply chain amid global disruptions. Over recent years, the government introduced various incentives, including production-linked incentive (PLI) schemes for electronics, which have already attracted substantial investment.
In addition to duty removal, the budget outlined further investments in digital infrastructure and technology development, which could synergize with the mobile manufacturing sector’s growth.
While consumers may benefit from competitive pricing and a wider range of available devices, the policy’s success will ultimately depend on how effectively manufacturers capitalize on the cost benefits and expand their local operations.
The Department of Telecommunications and the Ministry of Electronics and Information Technology will oversee the implementation of the new duty structure and monitor its impact on the industry.
In summary, the Union Budget 2025’s decision to scrap basic import duties on certain smartphone components marks a strategic effort to strengthen India’s mobile phone manufacturing landscape. By facilitating easier access to affordable parts, the government seeks to promote domestic production, enhance export potential, and support the national vision of technological self-reliance.
