India is considering hiking import duties by 5-10 per cent on more than 50 items, including smartphones, electronic components and appliances, in the upcoming budget, three government sources privy to the discussions said on Monday.
The move to increase import duties is part of Prime Minister Narendra Modi’s self-reliant India campaign that aims to promote and support domestic manufacturing, said the sources.
One of the sources said the government was seeking to target additional revenue of about $2.7 billion to $2.8 billion from the moves, as it looks to shore up revenue amidst the pandemic-driven slowdown that has stung the economy.
Two of the sources also said the duty hikes could impact furniture and electric vehicles, potentially hurting the likes of Swedish furniture maker Ikea and Tesla, which is planning to launch its cars in India this year. Both Ikea and Tesla executives have previously expressed concerns about the steep duty structure their products already face in India.
The officials, however, did not specify how much of a hike was planned on furniture and electric vehicles.