Government should not make any change in customs duty for at least five years to promote domestic manufacturing. Economic research institute Global Trade Research Initiative (GTRI) said this in its pre-budget recommendations. GTRI also said that import duty on components should be continued, reverse duty issues should be resolved and customs duty slabs should be reduced from existing 25 to five to avoid legal tussle and confusion.
read this also
It said that these suggestions will prepare India to deal with the challenging global economic environment.
The institute said that countries around the world have agreed to deal with tough global conditions and in view of this, India should announce no change in (import) duty for five years. He said, “Any change can prove to be adverse to the Production Linked Incentive Scheme (PLI), phased manufacturing program and manufacturing initiatives.” The government should take steps like reducing import duty only when the economic scenario is clear.
GTRI said that all electronic and complex engineering equipment consists of thousands of parts and India can become a true manufacturer only if the parts are also manufactured here. He said, “But if the duty on components is zero then they will be imported and as a result the final production in India will be just a work of addition.” Most of the companies that do this work disappear after the incentives are over.
The institute said that there are more than 26 slabs of customs duty in India ranging from zero to 150 percent, which gives rise to disputes and legal disputes. He said that in the budget 2023-24, the government should reduce the tax slab to five.
Featured Video Of The Day
Supreme Court will issue translation of more than thousand decisions in 10 languages on January 26