Computer and Laptop Imports from China Soar as QCO Unable to Check Flow

· Zero Duty Promotes Import, QCO not Working

[ABS News Service/08.04.2024 facts from IE Story]

In January, nearly 90 per cent of the laptops and personal computers (PCs) imported by India came from China. In the month before that, Beijing’s share was well over 89 per cent and, in November, the figure was 83 per cent. In all, until January in the 2023-24 financial year (FY), nearly eight out of 10 laptops sold in India came from China, shows an Indian Express analysis of the Commerce Ministry’s import-export data bank.

This rising trend came despite New Delhi’s attempts to discourage laptop and PC imports from China. These efforts included a short-lived notification by the Directorate General of Foreign Trade (DGFT) in August 2023, which placed the import of these goods under the restricted category, and the government sweetening its IT hardware manufacturing incentive policy to kickstart domestic production.

And yet, India’s total laptop import went up 5 percent year-on-year in FY24 (until January), while such imports from China increased 6 percent. In quantitative terms, China exported 64.93 lakh units to India in FY24 compared to 61.24 lakh units in FY23. January is the latest month for which the data for this category (HSN: 84713010) is available with the ministry.

Between April and July 2023, before DGFT’s notification, China’s average share in import was close to 76 percent. Between August and October, amid uncertainty around the deferred notification. China’s share came down to around 70 percent. From November 2023 to January 2024, after the licence plan was dropped, Beijing’s share in imports of the goods shot up to 87.5 percent.

These developments came even as the US, aiming to protect American companies such as Apple, Dell and HP, stepped up efforts to discourage the Indian government from imposing strict laptop import restriction.

In August, when the import restriction notification was issued and postponed a day later by the DGFT, around 10.43 lakh laptops and PCs wee imported. Of these, China accounted for 6.7 lakh, or roughly 64 percent. This was a rare decline in China’s share of total laptop import to India. In the same month, imports from Singapore saw a bump as it exported close to 2.56 lakh units to India.

At the time, the Indian Express had reported that companies such as Apple and Samsung had frozen imports from China until further clarity and that the government put off the curbs amid intense industry pushback.

Meanwhile, companies shored up their inventory, with laptop imports showing a big spike in September. A total of around 15 lakh units made their way into the country that month and China accounted for more that 11 lakh unit – close to a 74 percent share.

The next month, overall laptop imports saw a sharp decline, with around 3.3 lakh units comping to India. China’s share of the total, however, jumped to nearly 83 percent as it accounted for 2.72 lakh pieces – a trend that solidified in the next two months.

In December, India imported around 5.2 lakh laptops (worth around $276 million) and China commanded a lion’s share of these at 89 percent, or 4.67 lakh units. In January, China’s share grew even further: India imported 6.9 lakh laptops of which 6.2 lakh, roughly 90 percent, came from China.

The trend comes at a time the production-linked incentive scheme for IT hardware is understood to be moving in the slow lane. “The government had asked companies to come back with production targets under the scheme but they are yet to receive detailed projections by them despite repeated by them despite repeated efforts,” an industry source said, requesting anonymity.

[Source: Indian Express]