Budget 2024: This time drive china away...

In late january this year, even before the presentation of the interim budget, the government issued a notification to reduce the tariff on mobile phone parts from 15% to 10%. The aim of this move of the government was to promote local production and exports and reduce product prices in local markets. This decision of the government also benefited mobile parts manufacturing companies like apple and Foxconn. In fact, till now china used to be the hub of mobile part manufacturing. However, due to India's reduction in import duty on mobile phone parts and increasing tension between the US and china, America has started shifting Apple's manufacturing from china to India.

After geopolitical tensions and the Corona epidemic, other American tech giants including apple are also working on expanding their manufacturing facilities outside China. In such a situation, after the decision to reduce import duty, the foreign company manufacturing in india is proof that low tariffs for inputs and subsidies help to promote domestic manufacturing.

Now that the first full budget after the 18th lok sabha elections is to be released in india, the demand for a reduction in 'high' tariff charges, especially on industrial raw materials and intermediate products, has intensified. Let us know in detail what the people of this sector expect from this budget, and whether the budget can take decisions like further reducing this import duty.

NITI Aayog report

NITI Aayog said in a report last week that india needs to significantly improve import duty and use fiscal incentives to become a major player in the global value chain (GVC) for electronics, and should set a target of $ 500 billion for this sector by 2030. Currently it is a little more than $ 100 billion. According to trade economists, rising tariffs and non-tariff barriers are in stark contrast to the progressive external trade liberalism policy adopted over the past decades, especially since the 1990s. They say that tariff reduction is the most important way to eliminate restrictions on imports.

At present, the China-plus-one strategy is being adopted in major economies. This is a global trade strategy in which companies are expanding their production and supply chain in other countries by removing or reducing it from China. The main objective of this strategy is to protect their business from risks and diversify the global supply chain. In such a situation, if india further reduces its import duty, then the country can get a huge benefit from it.