New Delhi: Finance Minister Nirmala Sitharaman announced a significant reduction of 15 per cent in the Basic Customs Duty (BCD) on mobile phones during her presentation of the Union Budget for the fiscal year 2024-25 in Parliament on Tuesday. This reduction is part of a broader effort to make mobile phones and related accessories more affordable for consumers by lowering the cost of imported components and finished products.Reduced import costs to enhance manufacturer profitabilityIn addition to mobile phones, the BCD on mobile Printed Circuit Board Assembly (PCBA) and mobile chargers will also be reduced to 15 per cent. This decision comes on the edge of a remarkable threefold increase in domestic production and almost a 100-fold jump in exports of mobile phones over the last six years, indicating the maturation of the Indian mobile industry. Sitharaman emphasised that this reduction is in the interest of consumers, aiming to pass on the benefits to end-users and potentially leading to reduced retail prices.The reduced BCD is expected to stimulate demand and increase the accessibility of mobile technology across different segments of the population. For the domestic mobile phone industry, this is likely to enhance competitiveness and encourage further investments. Manufacturers can benefit from lower import costs for essential components, thereby improving their production efficiency and profit margins.Smartphone Sales rise in IndiaAccording to the Worldwide Quarterly Mobile Phone Tracker by International Data Corporation, Indias smartphone market has been experiencing significant growth with 34 million units shipped in the first quarter of 2024, representing a year-over-year growth of 11.5%. This marks the third quarter in a row where shipments have grown, indicating a sustained upward trend in the market.Investment boost for startups In another significant shift, Nirmala Sitharaman proposed to abolish the so-called angel tax for all classes of investors, a long-standing proposal from the industry. This announcement is expected to drive more investments toward startups, which function as engines of economic growth, generating new jobs, ideas, products and services and playing a crucial role in bolstering the Indian start-up ecosystem.
