Import of IT goods may get expensive

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Import of IT goods may get expensive. (Reuters) Import of IT goods may get expensive. (Reuters)
SummaryThe government is in the final stage of negotiations with electronic chip makers.

The Budget is likely to make import of Information Technology (IT) and t0elecom products expensive, as the Telecom and IT ministry has sought changes in the duty structure for import of components to promote domestic manufacturing of electronic products.

“It is cheaper to import the components with zero duty and sell the product rather than manufacturing here. So, we need something to be done by the finance ministry on the duty structure to make it less attractive for people to import. Making import dearer will help in developing the manufacturing industry here,” said telecom minister Kapil Sibal.

Sibal said he was “sure the finance ministry will give encouragement to the Indian industry.” He added that if domestic manufacturing is not encouraged, the import bill for electronic products will reach $320 billion by 2020, which will be even higher than the import of crude oil.

Meanwhile, the government is in the final stage of negotiations with electronic chip makers for setting up a high-tech chip making facility in the country this year.

“We have to set up a fab (electronic chip fabrication) unit here in this year. We will have proposal very soon in our office. We will take it for Cabinet approval for that fab,” Sibal said.

The project to set up two semiconductor plant in the country was approved by the Cabinet. It envisages an investment of around Rs 25,000 crore.

Unveiling a one-year agenda of department of electronics and IT, the ministry also announced their target to provide e-literacy training to one million people in 2013. The plan is to ‘e-literate’ at least one member in all households across the country.

“The idea is to provide training to people according to their needs and that is why we have broken up into five levels. We may provide first two levels of training for free but there will be a charge for the three higher levels,” said electronics and IT department secretary J Satyanarayana.

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