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The Department of Industrial Policy and Promotion (DIPP) has asked the Department of Telecom (DoT) to address the issues of the telecom and IT industries on various policies related to product certification, testing and import duties.
Among the concerns is the rule mandating electronic products to be certified by the Bureau of Indian Standards (BIS) and testing of telecom equipment before deploying.
“The DoT has stated that it will accept international security certificates coupled with some India specific testing. However, due to lack of specific notified guidelines on the nature of the in-country testing required, companies are facing business uncertainty,” said the DIPP in a letter to DoT.
The IT department has said that all imported electronic goods should hold BIS certification. The aim is to curb the flow of substandard electronic products into the country, some of which pose safety hazards.
The goods requiring such certification were listed under 15 categories including laptops, tablets, TVs, microwave ovens, printers, scanners and set-top boxes.
However, the DIPP said in its letter, frequent and inconsistent changes in BIS regulations are not in sync with global best practices, significantly adding to compliance issues.
One example is a new labelling circular asking labels to be screen-printed or embossed, and a reduction in validity period from two years to one.
Also, the letter said, “India does not accept international safety certifications and destructive safety re-testing in India leads to increase in products cost and time to market by seven months.”
Call for changesPointing out other concerns, the DIPP has asked the DoT to make some changes such as the inverted duty structure (effective duty of 16 per cent as against 12 per cent for finished goods), transfer pricing and aggressive tax administration and litigation.
“As a result, the level of tax litigation (all taxes) in India is of general concern and creates great uncertainty to business.
“There appears to be a lack of opportunity for settlement outside of the courts and litigation is seen as the norm,” the letter added.
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