Centre's Big Push To Manufacturing: Customs Duty Cut On Electronics Parts

The Centre has given another push to India's electronics manufacturing ambitions by extending customs duty exemptions on several critical components used to make display modules, smartphone wireless charging systems, and lithium-ion batteries.

The duty relief, which will remain in force until March 31, 2029, is expected to lower input costs for manufacturers and encourage fresh investments in electronics production across the country. The exemptions take effect immediately.  

Among the biggest beneficiaries are manufacturers of display assemblies used in automotive, medical and industrial equipment. The government has exempted customs duty on key imported inputs such as display cells, backlight units, flexible printed circuit assemblies (FPCAs), frames and anisotropic conductive film (ACF) used in manufacturing these products.  

The exemption, however, does not apply to display assemblies meant for mobile phones, televisions, smartwatches, smart meters or interactive flat-panel displays.  

Electronics Manufacturing: Customs Duty Concessions

The government has also extended customs duty concessions on components used in wireless charging modules for smartphones. These include NFC and inductor coil-related parts such as nano-crystalline assemblies, E-shields, PET liners, PC shims, coils and neodymium iron boron (NdFeB) magnets. 

Meanwhile, the Central Board of Indirect Taxes and Customs (CBIC) has also issued technical definitions for these components to ensure uniform implementation.  

In a parallel move, the Centre has significantly widened the list of machinery eligible for concessional customs duty for lithium-ion battery manufacturing. The revised notification now covers 85 categories of equipment, spanning almost the entire battery production process-from material mixing and coating to welding, testing, inspection and packaging. 

Supporting systems such as solvent recovery, heat recovery, dust collection and effluent treatment equipment have also been included.  

Electronics Manufacturing: Reducing Foreign Dependence

The latest measures are aimed at reducing dependence on imported finished products by making it cheaper to manufacture sophisticated electronics in India. Industry observers say lower import costs for specialised machinery and components could strengthen domestic supply chains, particularly in sectors linked to electric mobility, consumer electronics and advanced manufacturing.  

The move also aligns with the government's broader manufacturing strategy under its electronics and semiconductor push, where policymakers have been trying to deepen local value addition while attracting fresh investments into high-tech manufacturing.