Industry players and the government seem to be on the same page with the Centre’s latest move to put imported completely-built units (CBUs) of colour televisions in the restricted category.

According to government officials, this move will regulate imports from both China and South-East Asia as importers of CBUs will now need to seek licenses for the same. The industry feels that move will provide a boost to domestic manufacturing and assembling done with value engineering. Industry players also said that development of a domestic components eco-system will be the next critical step in this sector towards self-reliance.

“Imports are coming in at reduced/zero duty under the Asean-India FTA which gives them a significant advantage and such imports cannot be controlled through increased duty. Hence, non-duty actions like import restrictions are one of the main actions available to the government,” the government official said.

The move puts the spotlight on brands that have been leveraging FTAs to import from Asean countries as well as on relatively new Chinese entrants in business.

In addition, retailers that import TVs and sell them as private labels will need to revisit their strategies. Established international TV brands, with large manufacturing capacities, too, need to rely on imports for a small percentage of their high-end units.

“Restricted category would entail a requirement of justification from importers for such imports with multiple other possible permission and NOCs needed,” said Abhishek Jain, Tax Partner, EY India.

Market size

China, Vietnam, Malaysia and Hong Kong have been the top five countries for CBU TV imports. As per government data, TVs worth ₹7,224 crore were imported in 2018-19 of the total market size of ₹25,000 crore.

A Phased Manufacturing Programme for encouraging the manufacture of TVs, on the lines of mobile phone production, is underway and specified parts like open cell, chips on films, Printed Circuit Boards Assembly are exempted from duty, the official said adding, “India is getting ready for shift of manufacturing to India with cost effective imports of essential parts, if required.”

Avneet Singh Marwah, Director & CEO of SSPL, brand licensee for Thomson and Kodak TVs in India, said, “Currently about 28-30 per cent of TVs sold in India are imported. This move helps in incentivising companies that have made investments to set up domestic manufacturing capacities.”

Added Sunil Vachani, Chairman, Dixon Technologies, which is a third-party manufacturer for many brands in India, “This will provide a major boost to indigenous manufacturing as more brands will now look at local manufacturing spurring investments. We are in fact expanding our own capacities.” Off late international brands, that had been relying on imports from FTA countries, have been looking at local manufacturing through third-party manufacturers.

Samsung, which had started importing TVs from Vietnam, has inked agreements with third-party manufacturers Dixon Technologies and Skyworth for making their LED TVs in India this year.

Mike Chen, Country Manager, TCL India, said, “We focus on TVs from 22-55 inches and hence our factory at Tirupati right now supports around 70 per cent of our products. For higher sizes, we are importing but we are trying to do localisation of these products too in the near future. Apart from that the main focus is on licensing ...so that is something we are already in touch with DGFT."

A spokesperson for Xiaomi said, that currently over 85 per cent of Mi TVs sold in India are manufactured here. Satish Padmanabhan, Head of Sales at Sony India, said that the company has been investing heavily to shift local manufacturing of TVs to India since 2015 and 99 per cent of the Bravia TVs are made here.

Gireesan T Gopi- Business Head- Home Entertainment- LG Electronics India, said, “We have been the largest TV manufacturer in India . Our entire range of TVs including OLED & UHD is manufactured in India. We are committed to make-in-India and will be further strengthening our manufacturing capacity here."

ICEA plea

Indian Cellular & Electronics Association (ICEA) had last year suggested to the government to temporary suspend import of TVs for a few months from ASEAN countries.

Pankaj Mohindroo, Chairman of ICEA, said, “We have sufficient manufacturing capacity in India — imports of CBUs is unnecessary...We should now, as industry and as a nation, rapidly build huge capacities for exports and also build the component industry esp the open cell/display industry.”

Added Kamal Nandi, President of CEAMA, “We have been closely working with the government to formulate and facilitate both phased manufacturing and end-to-end manufacturing of Televisions in the country. CEAMA has been in discussion with the government on a phased manufacturing plan of TVs.”

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