Government Restores 2% Additional Duty Incentive On Mobile Phone Exports
Employees test mobile phones on an assembly line in the mobile phone plant of Rising Stars Mobile India Pvt., a unit of Foxconn Technology Co., in Sriperumbudur, Tamil Nadu, India. (Photographer: Karen Dias/Bloomberg)

Government Restores 2% Additional Duty Incentive On Mobile Phone Exports

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The government has restored 2 percent additional duty incentive on mobile phones export with a view to boost shipments of the product, according to a notification of the commerce ministry.

The duty benefit under the Merchandise Export from India Scheme is effective from Jan. 1 and will be there till March 31, 2020.

"A 2 percent additional ad hoc incentive for mobile phones is notified for exports made with let export date from Jan. 1 to March 31, 2020," the Directorate General of Foreign Trade has said in a notification.

DGFT is an arm of the commerce ministry which deals with issues related to exports and imports. The directorate on Dec. 7 last year had reduced this export incentive from 4 percent to 2 percent.

The India Cellular and Electronics Association had expressed disappointment over cut in the incentive, stating it will lead to massive job losses. According to estimates, mobile phone exports grew from Rs 1,300 crore in 2017-18 to over Rs 25,000 crore at present.

Also read: Worldwide Sales Of Smartphones Decline For First Time Since 2008

Under MEIS, the government provides duty benefits depending on product and country. Rewards under the scheme are payable as percentage of realised free-on-board value and, MEIS duty credit scrip can be transferred or used for payment of a number of duties including the basic customs duty.

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