Monday, 30th October 2017

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Duty slice offer to US

India has doubled the import duty on smartphones to 20% as part of the Make in India initiative to woo foreign manufacturers

By R. Suryamurthy in New Delhi
  • Published 12.04.19, 12:37 AM
  • Updated 12.04.19, 12:37 AM
  • a min read
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Production in India would help the Cupertino, California-based company avoid import duties of 20 per cent. Apple will also be in a position to meet the rule that a company must source 30 per cent of its requirements from local players, if it wants to open stores in the country. (Shutterstock)

Apple’s iPhones and other high-end smartphones could get cheaper if the US agrees to the lower duty proposed by New Delhi and gives market access to Indian engineering goods, agricultural products and auto parts.

“We have offered to reduce the duty or completely remove it for high-end smartphones which are over, say Rs 50,000. However, the US seeks complete elimination of duties on all mobile phones,” a commerce ministry official said.

The country has doubled the import duty on smartphones to 20 per cent as part of the Make in India initiative to woo foreign manufacturers, especially electronics makers.

There is no proposal to cut the duty on budget phones as they mostly come from China. Besides, a higher duty will encourage the production of the cheaper phones within the country itself.

The prolonged trade tiff between India and the US has resulted in Apple manufacturing phones in the country.

Production in India would help the Cupertino, California-based company avoid import duties of 20 per cent. Apple will also be in a position to meet the rule that a company must source 30 per cent of its requirements from local players, if it wants to open stores in the country.

Officials said India was ready to lower its duties on smartphones, smartwatches, printer ink cartridges and other ICT products.

At the same time, it is seeking the removal of steel duties and a greater market access to its farm products, engineering goods, auto and auto parts.

The US is demanding a greater market access through a cut in import duties for its agriculture goods, dairy products, medical devices, IT and communication items.

The US wants India to cut the duties on iconic bike Harley Davidson and offer a margin of up to 30 per cent over the production cost to its medical equipment.

Stalled talks

Trade talks between India and the US got stalled last month when Washington announced it would withdraw the Generalised System of Preferences from May 2019, under which about 3,500 India items were allowed duty-free entry into the US.

The channels of communication between the two countries have resumed and official level talks would start soon, officials said.