Budget 2015: Handset makers seek tax breaks, subsidies to grow domestic manufacturing

NEW DELHI: Mobile handset makers like Micromax and Karbonn have sought tax holidays and subsidies in the upcoming Budget to promote local manufacturing, a move they expect will create lakhs of jobs.

One of the fastest growing mobile phone market globally, India lags behind China as most handset makers, including Indian players, get their devices manufactured in China.

It is imperative that the government provides a fillip to manufacturing in the country by making its policies directly competitive to present "monolith China", Micromax Chairman Sanjay Kapoor told PTI.

"I hope the government will adopt a carrot rather than a stick approach for India's burgeoning smart devices market through encouraging and supportive rules and regulations to expedite the eco-system creation in India which is quintessential for smart device manufacturing," he added.

Kapoor said failing to do this will make it "difficult" for smartphone manufacturers to provide the latest technology at competitive prices, which is pivotal for the success of 'Digital India'.

Pradeep Jain, Managing Director at Karbonn said indigenous products will help the country realise the vision of initiatives like 'Digital India' and 'Make in India' and take the mobile and Internet revolution to mass consumers.

"In Budget 2015, the government should be introducing friendly policies including tax holidays and interest subsidies to give a push to domestic handset manufacturing and increase the mobile phone user base in India," he said.

The collateral benefits are greater employment opportunities, higher quality standards and better pricing, said Jerold Pereira, chief executive at Videocon Mobile Phones.

Jain said government should also look at steps to facilitate easy financing options for mobility goods like mobile devices and tablets to establish India as global power in international mobile market, he said.

"With locally manufactured products, we expect to see billion hands using mobile phones for communicating and sharing data in coming years," Jain added.

Maxx Mobile Chairman and Managing Director Ajay Agarwal hoped that custom duty on imports for mobile handsets will be increased.

"We also hope that the government will offer ESOPS, subsidies on investments and incentives for Indian mobile manufacturers," he added.