Budget 2024: Local telecom gear manufacturing to get a boost with customs duty hike

Local manufacturing of telecom network gear is set to get a boost with finance minister Nirmala Sitharaman proposing a 5% increase in the basic customs duty (BCD) of printed circuit board assembly (PCBA) to 15% in Budget 2024-25, a move that will make imports of this vital network gear input costlier.

A consequent step-up in local PCBA production is also expected to marginally reduce the final price of telecom network equipment.



The PCBA is arguably the most critical input for manufacturing all kinds of telecom network gear, from routers, exchanges, base stations, basic phones, to network transmission equipment. It is essentially the finished board after all sub-components have been soldered and installed on a printed circuit board (PCB), say industry executives.

“The FM’s call to increase the BCD on PCBAs to 15% (from 10% now) will definitely give a shot-in-the-arm to local manufacturing of this vital input that is at the heart of virtually every category of telecom network equipment. It will also rightly discourage its imports as India has adequate domestic manufacturing capability/capacity of PCBAs and can be self-reliant,” N K Goyal, chairman emeritus, Telecom Equipment Manufacturers Association (TEMA), told ET.


He added that increased local production of PCBAs will marginally reduce the price of telecom network equipment in the country.

Some industry executives, though, said the proposed BCD increase to 15% (from 10% now) is inadequate, especially as domestic telecom gear makers were expecting it to be raised to around 30% to ring in a level-playing field.