Union Budget 2025: Electronics Industry Calls for Zero Tariffs on PCBAs, Camera Modules, and Connectors
Union Budget 2025 – Mobile phone manufacturers and electronic device companies have appealed to the finance ministry to simplify the import tariff structure in the Union Budget for 2025-26 by reducing the levy on parts, inputs, and sub-parts of sub-assemblies or components such as PCBAs, FPCs, camera modules, and connectors to zero from 2.5 percent.
The India Cellular and Electronics Association (ICEA) has emphasized that high tariffs on sub-assemblies and their components significantly raise manufacturing costs, impeding India’s global competitiveness. The ICEA has stressed the importance of implementing a zero-tariff structure to strengthen the sector.
ICEA Chairman Pankaj Mohindroo highlighted that India’s current tariff system is one of the most complex globally, with various rates ranging from 0 percent to 15 percent, plus surcharges. This complexity, particularly in sub-assemblies and components, negatively impacts global competitiveness and export potential. Mohindroo expressed confidence that simplifying the duty structure would enhance competitiveness, attract investments, and propel India towards becoming a global leader in electronics manufacturing.
In a recent communication, the ICEA shared its recommendations with Sanjay Malhotra, the revenue secretary to the Ministry of Finance. Moneycontrol has reviewed a copy of the letter.
The association also urged the ministry to classify FPCBAs under a new HSN Code with a 10 percent duty. Currently, FPCBAs are categorized as PCBAs, despite their functionality being more aligned with connectors. To support domestic television manufacturing, the ICEA proposed reducing the duty on sub-assembly inputs for open cells to zero percent. The current 2.5 percent tariff on inputs is seen as detrimental to the competitive edge and discourages local production due to an insufficient differential duty.
The Indian Cellular and Electronics Association (ICEA) has proposed a rationalization of duties on components for audio devices to support the growing domestic industry. The association recommends maintaining the current duty rate on all components and inputs used in audio devices and postponing the duty increase outlined in the 2025-26 Production-Linked Incentive (PLI) scheme. This approach is suggested to allow the domestic industry to expand and the supply chain to develop.
Also Read: Union Budget 2025
According to ICEA President, Pankaj Mohindroo, this strategy will enable domestic production to increase and adapt to rapid technological advancements and product modifications. It will also help in reducing costs associated with manufacturing.
ICEA has also emphasized the need to address the complex duties on inductor coil modules, which currently lead to increased costs, customs complications, and clearance delays, affecting the efficiency of the supply chain.
Furthermore, ICEA has proposed reducing the duty on car display inputs from 15 percent to zero. This reduction, along with similar duties on components like BLUs, cover glass, and open cells, aims to simplify the duty structure and enhance cost-effectiveness.
The association believes that aligning the duty structure for display assembly inputs with that of mobile phone displays will encourage the growth of display assembly manufacturing in India. Therefore, ICEA suggests that all inputs for display assembly, regardless of their end use, should be subject to zero duty to promote scale and efficiency in the industry.
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