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India eyes limits to laptop, tablet, PC imports next year

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Plan to restrict imports withdrawn last year after

backlash

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New import curbs could reshape $10 billion laptop, PC

industry

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India offers $2 billion in subsidies for local production

By Shivangi Acharya

NEW DELHI, Oct 17 (Reuters) - India is expected to limit

imports of laptops, tablets and personal computers after

January, two government sources with direct knowledge of the

matter said, a move to push companies such as Apple ( AAPL ) to

increase domestic manufacturing.

This plan, if implemented, could disrupt an industry worth

$8 billion to $10 billion and reshape the dynamics of the IT

hardware market in India, which is heavily reliant on imports.

A similar plan to restrict imports was withdrawn last year

following backlash from companies and lobbying from the United

States. India has since monitored imports under a system set to

expire this year and has asked firms to seek fresh approvals for

imports next year.

The government feels it has given the industry enough time

to adapt, said the sources, who did not want to be identified as

discussions are private.

One of the sources said New Delhi will begin consultations

with all sides starting next week. It could delay implementing

the import restrictions by a few months if needed, the source

added.

India's Ministry of Electronics and Information Technology

(MeitY) is working on a new import authorisation system, where

companies will have to get prior approvals for their imports,

one of the two sources said.

Under the current regime, laptop importers are free to bring

in as many devices after an automated online registration.

The industry is dominated by the likes of HP, Dell

, Apple ( AAPL ), Lenovo ( LNVGF ) and Samsung, with

two-thirds of Indian demand being currently met through imports,

a significant amount from China. India's IT hardware market,

including laptops, is estimated at nearly $20 billion, of which

$5 billion is domestic production, according to consultancy

Mordor Intelligence.

The government is considering minimum quality standards

under its 'compulsory registration order' for laptops, notebooks

and tablets, as one of the ways to weed out low quality devices,

the officials said.

"We are working on such restrictions as global treaties stop

us from any tariff action on laptops and tablets. It leaves us

with few policy options to limit imports," the second official

said.

The federal electronics ministry did not respond to request

for comment. The trade ministry said an appropriate decision on

the import management system would be taken after consultation

with the electronics ministry and other stakeholders.

Such a move will benefit contract manufacturers such as

Dixon Technologies who have entered separate pacts

with global firms like HP to make laptops and computers in

India. Dixon aims to cater to 15% of India's total demand.

LOCAL PRODUCTION

Limits to India's imports should be calibrated based on

India's domestic production capacity, an industry source who is

part of the government's consultations said.

The nation's key production incentive scheme for IT hardware

has drawn participation from global firms including Acer

, Dell, HP and Lenovo ( LNVGF ). Most of the approved

participants are ready to start manufacturing, India's

electronic minister said last year.

India has federal subsidies worth nearly $2.01 billion to

promote domestic production.

Data from research firm Counterpoint shows imports of

laptops completely assembled abroad in the first five months of

2024 fell 4% from a year earlier, with firms such as Lenovo ( LNVGF ) and

Acer increasing local assembly for entry-level laptops.

India has been long emphasised the need for "trusted

sources" for electronics and communication devices amid growing

concerns over cyberattacks and data theft.

In 2022, Indian Prime Minister Narendra Modi said India

should cut reliance on foreign countries for communication

technology such as servers.

India will implement mandatory testing of "essential

security parameters" for all CCTV cameras from April 2025.

($1 = 84.0390 Indian rupees)

(Additional Reporting by Munsif Vengattil in Bangalore; Editing

by Jacqueline Wong)