The India Cellular & Electronics Association (ICEA) has urged the Finance Ministry to extend the zero duty on open cell for televisions beyond September, for another three years to boost domestic manufacturing and curb imports of LED TVs under FTAs.
In its letter to the Finance Ministry, the industry body said currently there are no manufacturers for open cell and that it will take 3-4 years for a company to establish a plant. “If the duty on open cell is not extended beyond September 2020, it will again lead to high imports of LED TVs under FTA, a huge blow to the ‘Make in India’ programme of government. It will have an adverse impact on the domestic television manufacturers,” it stated. It has instead recommended the implementation of the proposed phased manufacturing plan for TVs where duty on open cells can be levied post the fab becomes operational. Open cell panel is most important component used in TV manufacturing, accounting for 65-70 per cent of its production cost.
“There was a proposal by MeitY to impose duty of 5 per cent on open cell and bring pure cell to zero percentage to encourage the process of polariser film and COF bonding for open cell. That said, we are concerned about the implementation of this notification as the anomaly in differentiation of open cell with bonding and open cell without bonding (pure cell) still remains a challenge,” the letter added.
ICEA said that the grey market will flourish as “as opportunistic traders will import complete open cell (bonded cell) by wrongly declaring it as pure cell for processing at reduced duties. Stating that it is visually not possible to identify the difference between pure cell and cell with polariser film and bonding, it added that there is no separate HSN code which differentiates the pure open cell and open cell (with polariser film and COF bonding).
“Indian domestic television manufacturers have contacted open cell makers for this project. However, none of them has shown interest to outsource the technology to any third party, nor they have allowed elsewhere worldwide,” it added.
“Various players in India are using different technologies for the open cell. For example, LG who is one of our members uses only IPS technology whereas the investment coming into the country for polariser film and bonding will only be supplying panels with VA technology and if we impose duty on open cell then such players would have a disability,” the ICEA letter stated.-The Hindu Business Line