The 5% cut of the total import quota to be taken by companies will be based on the data from the Directorate General of Commercial Intelligence and Statistics and will be implemented from April 1 of the upcoming fiscal, the sources said.
While the reduction in import bill is one of the “strongest ideas”, the stakeholder discussions are still going on, another official said.
“One such idea is that companies lower their imports and simultaneously do value addition so that the country’s overall import dependence goes down. We don’t want business continuity to get hit,” a senior government official told ET.
For example, if a company imports the specified electronics goods worth $4 billion yearly, it will be asked to cut its import bill by 5% for FY25, while also being asked to increase the domestic value addition on products being assembled or manufactured in India, another source said.
“So, there will, however, be no quantitative restrictions. The restrictions or the reductions that have been proposed are based on rough estimates of how much each company tells the government they are likely to import in a fiscal,” an official said.
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Apart from being asked to lower their import quotas gradually every financial year, the government is also likely to undertake period reviews and audits of the domestic production numbers shared by the companies with the government, another official said.“The formula (of taking a 5%reduction) has been communicated to the industry and they are largely okay with it. We have also said that whatever domestic production numbers are shared, the government will periodically review it, possibly every quarter starting September 2025,” the official said.
Stakeholder consultations are in full swing ahead of the December 31 deadline for the present import management system (IMS) for certain IT hardware products such as personal computers, laptops, and tablets.
ET had on October 29 reported that the government was likely to offer some concessions in import quotas to electronic hardware manufacturing companies that can step up domestic production under the production-linked incentive (PLI) scheme for information technology (IT) hardware.
The government first imposed import restrictions on laptops, tablets, all-in-one personal computers, ultra-small form factor computers and servers on August 3, 2023.
In September, the government extended the timeline for the import management system (IMS) for certain IT hardware products such as personal computers, laptops, and tablets by three months until December 31.
In FY24, imports of these products stood at $8.4 billion against the authorisation of around $9.5 billion. As per officials, the import monitoring system showed most of the goods came from China with the rest from Hong Kong, Southeast Asia, and the US.
