Local telecom equipment cos seek equality with importers

NEW DELHI: Domestic manufacturers of telecom equipment, such as repeaters and bi-directional amplifiers, have sought level-playing field vis-a-vis imports. Local manufacturers have to pay a duty of up to 12.5% on import of components, while import of finished product attracts zero duty.

These items are not covered under the ITA agreement under which import of IT and telecom equipment and components attract zero import duty. However, under an exemption list, the government reduced import duty on these products to zero for telecom operators. The exempt list was introduced in 1997.

When the exempt list was introduced, there was no local manufacturing of these items in the country. Now, at least six companies are manufacturing repeaters in the country. These include Astra Microwave, Avantell, Kaveri Telecom, Shyam Telecom, Four S and Microqual.

“In order to encourage local manufacturing, both the domestic manufacturing and import of equipment should be put on an equal footing,” said Arun Khanna, former president and governing body member of telecom equipment manufacturers Association (Tema). Therefore an import duty should be applicable on import of these equipment, said Mr Khanna.

“We are in the threshold of making India as a base for manufacturing and in this background if such disparities are not removed, why would investment come in manufacturing in India,” said Mr Khanna. Recently, due to heavy expansion in the Indian telecom, the manufacturers have found it prudent to manufacture some of the major items exempted in the list.

Companies like Ericsson, Nokia, Alcatel (ITI) have recently announced plans to manufacture BTS in India. More radio communication and transmission equipment are being manufactured in the country.