The Government’s move, in the Budget proposal, to cut customs duty on nearly 22 items would boost local manufacturing and may reduce prices for some appliances, say consumer durable players.

Reduced customs duty

For starters, microwave ovens and refrigerators may get cheaper. The Government has reduced basic customs duty from 5 per cent to nil on Magnetron (of up to 1 KW), which is used to manufacture microwave ovens. In addition, basic customs duty has been reduced from 7.5 per cent to 5 per cent on certain components used for manufacturing refrigerator compressors.

Kamal Nandi, Business Head and Executive Vice-President, Godrej Appliances, said that the customs duty reduction shall positively impact microwave oven and refrigerator compressor manufacturing. However, the extent of reduction in prices for the consumer is not yet known.

Positive move

The Budget proposal also announced reduced customs duty on Organic LED (OLED) TV panels from 10 per cent to nil. Analysts point out that OLED TVs are still a niche product with less than one per cent market share. Basic customs duty on back light unit module, used in LED panel manufacturing, has also been reduced from 10 per cent to nil.

Soon Kwon, Managing Director, LG India said, “It’s a positive move for the industry and we are hopeful to witness a boost in the sale of Organic LED TVs.”

Anirudh Dhoot, Director, Videocon, said this was a thrust on the Centre’s Make in India project. “This will boost assembly and value added manufacturing in the country,” he added.

Manish Sharma, President, Consumer Electronics and Appliances Manufacturers Association and MD Panasonic India & South Asia, felt that the move will encourage indigenous manufacturing and technology proliferation.

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