Finance minister Arun Jaitley was certainly the man of the hour on Thursday as he presented the Union Budget for 2018-19. A lot of gullible taxpayers' eyes were peeled onto the TV screens or mobile phones as the minister covered the provisions of the Budget for various categories.
The technology industry was an important aspect of the Budget 2018-19, as Jaitley touched upon new age technologies like artificial intelligence, blockchain, and machine learning. Smartphones, which account for huge interest among consumers as well as manufacturers, took a hit in the budget.
In his budget speech, Jaitley raised the customs duty on mobile phones to 20 percent from existing 15 percent. This was done with the aim to boost jobs in India with local manufacturing. The decision doesn't sit well with some brands and consumers who will now have to pay a higher price for imported phones, such as iPhones.
But the hike in the customs duty doesn't affect much the OEMs that are already manufacturing in India. Brands like Nokia, OnePlus, and Micromax are some examples.
Here's how the major tech leaders reacted on the Union Budget 2018-19 on the whole.
"HMD Global continues its strong emphasis on PM Modi's Make in India campaign. While the import duties for mobile phones increased to 20%, along with a 15% duty on key components, this will have a minimum impact on our business, as all of our current portfolio of Nokia phones are manufactured in India," Ajey Mehta, vice president India, HMD Global, said in an email statement.
"Since the announcement of Make in India program 3 years back, over 85% of smartphones the sold in the country are now produced locally. So, this is opportune time to introduce next set of regulations to attract investment in the manufacturing sector and establish India as a global hub for electronics. At OnePlus, we are fully committed to the Indian market and welcome the proposed regulations. Currently, all OnePlus smartphones are produced locally and we are already exploring ways to further increase the share of local manufacturing to ensure there is minimal cost impact of any new regulations to the end customer," Vikas Agarwal, general manager at OnePlus India, said.
"We are fully committed to the Indian market and welcome the proposed regulations" - OnePlus GM Vikas Agarwal
"The increase in customs duty on Mobiles will encourage local manufacturing. As India is becoming the global hub for manufacturing, the measures taken by the government will surely grow confidence amongst the manufacturers and I strongly believe that this will further create business and human resource opportunities as well," Rajesh Aggarwal, Micromax co-founder, said in a statement.
"Micromax is deeply connected on the Make in India initiative with 3 running factories and we support this" - Micromax co-founder Rajesh Aggarwal
"The government's measures towards the import duty on printed circuit boards (PCBs), camera modules, connectors and other components that go into making smartphones, will boost the Make in India initiative and will relentlessly pursue in curbing imports and building value addition in the country. Micromax is deeply connected on the Make in India initiative with 3 running factories and we support this," Aggarwal added.
But some brands do share concern over the hike on the customs duty and the challenges faced by brands for local production.
"The increase in customs duty from 15% to 20% will definitely hamper the cost to the customer, especially when it comes to getting repairs for the high-end devices. While the increase in customs duty on handsets will compel brands to manufacture or assemble more in India, still there is not great support for local ecosystem for manufacturing spare parts. And this lack of local spare part manufacturers will mean a tough situation for mobile handset brands. Hence a brand is compelled to import most of the spare parts and customers have to bear some burden of it." Syed Tajuddin, CEO of Coolpad India, said in a statement.
"The increase in customs duty from 15% to 20% will definitely hamper the cost to the customer" - Coolpad CEO Syed Tajuddin
Beyond smartphones, the television sector is also a part of the tech industry and brands share their concern with the latest Budget as well as GST slabs.
"The increase in customs duty on the certain parts of TV might affect the manufacturing ecosystem adversely. We need the government to help in creating an improved local manufacturing and a better component ecosystem for the consumer electronics manufacturers as well. With focus on growth, it is the budget to look forward that would add an impetus to India's growth story," Micromax's Aggarwal noted in his comments.
"The Government is very determined to ensure the success of the Make in India initiative. Therefore we welcome our Finance Minister's decision to increase customs duty on CBU of television, which is a good sign for boosting the domestic industry. We hope the Finance Minister will also reduce GST on television to 18% subsequently," Avneet Singh Marwah, director and CEO of Super Plastronics Pvt. Ltd. (Kodak HD LED TV India), said in a statement.
"We hope the Finance Minister will also reduce GST on television to 18% subsequently" - Director and CEO of SPPL Avneet Singh Marwah
Finally, some robust initiatives such as creating hundreds and thousands of Wi-Fi hotspots across rural India is more than welcomed by the e-commerce industry.
"With a focus on technology, the finance minister has provided great support to the digital industry. The government's decision to create 500,000 Wi-Fi hotspots in rural India will enable broadband access to those with no or little access to the realm of the internet. This will help grow the digital commerce industry and encourage more people to adopt cashless economy," said Sanjay Sethi, CEO & co-founder, ShopClues.
Stay tuned for more comments on the Union Budget 2018-19. Feel free to share your thoughts on the matter.
