Analysts say it will level the playing field with finished products, boost domestic manufacturing. While scrapping of the Special Additional Duty (SAD) on imported personal computer (PC) components is expected to provide a level playing field by encouraging domestic manufacturing, industry watchers opine that the introduction of an education cess might increase prices of PCs, smart phones and tablets marginally in the near future, as India does not have a big manufacturing ecosystem. Analysts that Business Line spoke to welcomed the move, as despite a tax increase of 0.3 per cent, the government has scrapped the duty structure, wherein manufacturers paid 4 per cent in the past.
However, others have doubts about the policy. “This will not do much as China has manufacturing scale. India should build on its strengths around software intellectual property,” said Sanchit Vir Gogia, an analyst at Greyhound Research.
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