India Electronics Duty Reform Proposal

The India Cellular and Electronics Association (ICEA) has submitted comprehensive recommendations for India's Union Budget 2026-27. The proposals focus on rationalizing customs duties, removing inverted duty structures, and implementing operational reforms to bolster India's electronics manufacturing ecosystem. Key suggestions include reducing Basic Customs Duty (BCD) on mobile phone sub-assemblies (microphones, receivers, speakers, PCBAs) from 15% to 10%, and on finished hearables/wearables from 20% to 15% (with mechanical parts reduced to 10%). ICEA also advocates for a calibrated tariff regime for display assemblies, proposing 15% duty on finished products and zero duty on inputs, mirroring existing structures for mobile phones and televisions. Furthermore, the association seeks zero-duty treatment for parts used in manufacturing capital equipment for mobile phones and calls for correcting inverted duties on inductor coils. Beyond tariffs, ICEA urges uniform customs classification for display assemblies, a separate tariff line for Interactive Flat Panel Displays (IFPDs), and reforms to the Manufacturing and Other Operations in Warehouse Regulations (MOOWR) scheme, including depreciation allowance and RoDTEP benefits. Finally, a uniform wastage norm of up to 2% for mobile phone manufacturing is proposed to enhance ease of doing business. These measures are intended to reduce cost distortions, improve investment stability, and strengthen India's position as a global electronics manufacturing hub.