Cos get breather as import curbs on PCs are deferred

The government has extended the deadline for implementing import restrictions on laptops, tablets, and servers to 1 November, a late evening government notification said.

According to the notification from the Directorate General of Foreign Trade, import consignments can be cleared without a licence until 31 October.

“There will be a transition period for this to be put into effect, which will be notified soon,” Rajeev Chandrasekhar, minister of state for electronics and information technology, said in a post on social media X on Friday before the notification was issued.

“There is no ban on imports. Companies and traders can import IT hardware, laptops, tablets etc. They will get time to apply for import licences,” a government official said earlier, providing much-needed relief to companies that were taken by surprise by the order issued Thursday. He declined to be named.

Another official who also did not want to be identified said that two companies had already applied on the portal introduced by the Director General of Foreign Trade, the body under the ministry of commerce and industries.

An entity can apply for more than one licence for more than one instance or shipment. Multiple units can also apply for licences. The licences will be given for one year. Officials said that the extension was being considered after the industry demanded more time for compliance.

The clarification was issued a day after India restricted the imports of IT hardware products, including laptops, tablets, servers and personal computers without a licence, which came into immediate effect via a notification on Thursday.

The move led to several companies such as Dell, HP, Lenovo, Samsung and Apple stopping shipments to India, even as some industry executives said that instances of goods being seized by customs authorities emerged following the implementation of the notification.

The second official said the government has communicated to the companies that they should continue imports. The official said that the IT ministry would help in facilitating the clearance of goods in transit and those that may be stuck at ports.

“Licence issuing portal by DGFT is already online, and licences will be issued within five minutes if applied correctly. There will be no disruptions,” the official said, asking not to be named.

The official also clarified that laptop makers had adequate manufacturing capacities within India and, therefore, it would not lead to a shortage of goods ahead of the start of the festive purchase season or the beginning of college sessions. “I don’t think there will be any impact on prices also,” he added. Officials said the decision to restrict the imports was taken from a national security perspective and to protect Indians from the increasing instances of breaches of user data and privacy. They added that the decision was taken with the objective of making India self-sufficient in manufacturing through the production-linked incentive (PLI) scheme.

In May, the government introduced the revised ₹17,000 crore PLI scheme for IT hardware to attract laptops, tablets, and other hardware makers to India after its first version with a lower allocation failed to take off. India imports about $8 billion worth of laptops and tablets every year, which the government wants to reduce, as it aims to lower the overall electronics imports that have ballooned to $70 billion in 2022.

“This is not at all about licence raj. It is about regulating imports to ensure trusted and verifiable systems and ensuring India tech ecosystem uses trusted and verified systems only that are imported and/or domestically manufactured trusted systems/ products,” Chandrasekhar said in a separate post on X, earlier known as Twitter.

Without naming China, the official cited earlier said that sourcing from trusted and reliable partners will be given priority. Securing India’s IT infrastructure from cyber threats was another reason for the import curbs, the official said.

The second official said the PLI scheme not finding any takers being one of the reasons for the government’s decision to impose the restriction was not accurate, as 44 companies had already registered for the IT hardware PLI 2.0, and two companies, including HP, had already applied. He added that the deadline for which has also been extended till the month’s end.

“We are aware of the new regulations. Dell has been manufacturing in India for 15 years, and we continue to work with the Indian government on our plan,” a spokesperson from Dell said in response to queries. HP, Apple and Lenovo did not respond to emailed queries.

A third official, from the commerce ministry, said that the intent behind the restriction is to attract investment within the country so that more and more countries can come to India and produce here.

“So, we want that the iPhone model should also be replicated in the PC segment. Prices won’t go up as there is excess capacity in India for some of these companies, which are saying that imports, particularly from China, are impacting their business plans. Most of these items are coming from China, and there is a trade imbalance with China,” the official said.