Indian Government Tweaks Licensing Norms for Laptops and Computer Imports

The Central Government of India recently made alterations to the erstwhile strict and rigid norms for importing Information Technology hardware products like laptops and computers while putting in place a system for online authorization in order to facilitate importers to obtain authority or licenses. This notification was brought forward in light of the previous announcement of the government which mandated necessary licensing for import of electronic goods in order to facilitate and boost the domestic manufacturing sector.

According to the new licensing rules, applicable to laptops, personal computers, micro – computers and certain data processing machines, it was stated by the Director General of Foreign Trade that there shall be no restriction on the quantity, value and country of imports. Moreover, there has also been an added provision for denying entry to organizations into the lists which will include those imports for which the procedure of transfer is quite different.

While stating that the regulations shall remain valid till September 2024, it was also laid down that those companies which are planning to import second – hand products or items which have been refurbished shall not be allowed to apply for re – authorization since the aim of such exercise is promoting the domestic manufacturing of electronic goods along with ensuring that there is no shortage of electronic goods in the country.  Additionally, with an increased inflow of electronic goods – both domestically and internationally produced, the supply of such products is bound to increase which would further lead to lowering the prices of the goods.

To make provisions for Special Economic Zones (SEZ), there has been no restriction on imports of spares, parts, assemblies, components, and sub – notified IT hardware essential items for capital goods. Moreover, there shall also be no restrictions for one laptop, one tablet, one personal computer or other allied products. In the recent past, there has been an exponential increase in electronic goods like laptops/computers and there has been a net increase of $2.5 Million in overall imports in the past year. The highest share of imports in this category is allotted to personal computers, desktops, and other personal usage electronic devices.

With the new and updated notification, it is the need of the hour to develop the administrative framework for the grant of licenses from the Director General of Foreign Trade (DGFT) in the form of the ‘import management system’ due to which earlier a number of objections have been raised from the side of World Trade Organization which claimed that India has approached this policy with bias towards domestic industry which would further lead to formation of trade barriers for the external international players and other manufacturers. Therefore, there is a need to approach the policy keeping in mind the provisions of International Trade Law and the needs of the country.