Apple, Dell, HP And Other IT Hardware Firms Seek Further Extension Of Laptop Import Licence Deadline

Major technology companies such as Apple, Dell, HP, Acer, and others have reportedly requested an extension of nine to twelve months from the government for the deadline to obtain licenses necessary for importing laptops, tablets, all-in-one personal computers, and other electronic devices.

During a meeting with senior officials from the Ministry of Electronics and Information Technology (MeitY), representatives from these companies said that they would require additional time to establish manufacturing facilities in India.

“The companies need reasonable time to set up manufacturing. We are also unsure about the process for licensing, and the data needed from us. So, we will need this time,” one industry executive who attended the meeting was quoted as saying by The Economic Times.

Last week, the government announced that licenses would be mandatory for the import of laptops, tablets, all-in-one PCs, ultra-small factor computers, and servers, effective immediately.

However, following a meeting between electronics company executives and senior officials from the IT ministry and the Directorate General of Foreign Trade (DGFT), the government granted the industry an extension until 31 October.

Starting from 1 November 2023, a valid license for restricted imports will be required for the clearance of import consignments. Currently, these imports are freely allowed.

A closed-door meeting was attended by representatives from major hardware companies, as well as lobby groups such as the Manufacturing Association of IT Hardware (MAIT) and the India Cellular and Electronics Association (ICEA).

The government reportedly assured the industry that the import licensing norms for specific electronics items were not intended to discourage or ban imports. Instead, they aim to minimise imports and promote exports from India by enhancing domestic manufacturing capabilities.

Apart from foreign original equipment manufacturers (OEM), government officials also met with senior executives from Indian OEMs to gather information on their production capacity and the time required for scaling up.

In the coming days, the IT ministry may also request foreign OEMs to provide an estimate of the number of high-end electronic items they plan to import in the next year, particularly after 1 November.

The aim reportedly is to understand the volume of imports and explore the most efficient ways to facilitate their smooth entry into India.

One of the industry's main requests is to not restrict the import of high-end IT hardware, such as top-of-the-line laptops and PCs, as there is currently no local manufacturing capacity for these products.

During the meeting, the discussion did not revolve around the process of obtaining the license.

In order to gather valuable insights on the process of acquiring licenses, MAIT and the ICEA will reach out to their members for input. These inputs will then be compiled and forwarded as recommendations to both the IT ministry and the DGFT.

An executive also mentioned that the import of TVs and air conditioners, which are subject to similar restrictions, already has an established process for applying for a license.

"If IT hardware companies require any changes from that set process, we will discuss them with the government,” the executive added.

In addition, some companies also highlighted the challenges they faced following the notice issued by the DGFT last week, which announced the restrictions.

According to an industry executive, despite a notification stating that shipments enroute would be cleared, all shipments were halted on 4 Augus, just a day after the notification was issued.

"There was no custom clearance happening till almost late evening of 5 August,” another industry executive said.

An official stated that all the companies involved in imports already have efficient mechanisms in place and are familiar with the process of getting shipments cleared. However, the government assured them of all possible assistance.

In the fiscal year 2023, the country imported IT hardware products worth $8.8 billion.

More than half of these imports, amounting to $5.1 billion, came from China, followed by $1.3 billion from Singapore.

The government is hoping that import licensing will boost local manufacturing, particularly with the implementation of the production-linked incentive (PLI) scheme for IT hardware.