DGFT, the Directorate General of Foreign Trade, has recently issued Policy Circular No. 06/2023-24, which introduces new restrictions on the import of certain IT hardware items. These restrictions will come into effect from November 1, 2023. The aim of this policy is to regulate the import of specific IT hardware and promote domestic production in India.
Under the new policy, SEZ units (Special Economic Zones) and EOUs/EHTP/STPI/BTP (Export Oriented Units/Electronics Hardware Technology Parks/Software Technology Parks/Biotechnology Parks) are exempt from obtaining a “restricted import authorization” for IT hardware items that are restricted under Notification 23/2023. However, this exemption only applies if the imported IT hardware is intended for captive consumption within these units. This exemption aims to encourage the growth of these specialized economic zones and support their operations by facilitating the import of necessary IT hardware.
It is important to note that there are no import restrictions on components that are necessary for the production of IT hardware devices specified in Notification 23/2023. This means that importers can freely import components required for the manufacturing of IT hardware without obtaining any additional authorization. This exemption recognizes the importance of these components in the production process and aims to ensure a smooth supply chain for IT hardware manufacturers in India.
Furthermore, the policy also exempts IT hardware items that are essential for capital goods from import licensing requirements. This exemption aims to facilitate the import of IT hardware that is necessary for the production of capital goods, thereby supporting the growth of industries that rely on such equipment. It recognizes the role of IT hardware in enhancing productivity and efficiency in various sectors and aims to remove any unnecessary barriers to their import.
To facilitate the import process, importers are allowed to apply for multiple authorizations. These authorizations will remain valid until September 30, 2024. This provision aims to provide flexibility to importers and streamline the import process for IT hardware items. Importers can apply for multiple authorizations to ensure a steady supply of IT hardware throughout the validity period, thus avoiding any disruptions in their operations.
The issuance of this policy circular by DGFT is a significant step towards regulating the import of IT hardware in India. By introducing restrictions and exemptions, the policy aims to strike a balance between promoting domestic production and meeting the demands of various industries that rely on IT hardware. It also aligns with the government’s vision of making India a global manufacturing hub and encourages the growth of specialized economic zones.
The source of this information is Darda Advisors LLP, a prominent advisory firm specializing in trade and policy matters. Their expertise in this field makes them a reliable source for information on such policy developments. It is important to note that Darda Advisors LLP is not associated with the government and their mention in this article is solely for the purpose of providing accurate attribution.
In conclusion, the introduction of Policy Circular No. 06/2023-24 by DGFT brings new restrictions and exemptions on the import of certain IT hardware items. These measures aim to regulate the import of IT hardware, promote domestic production, and support the growth of specialized economic zones. The policy recognizes the importance of components and capital goods in the IT hardware industry and provides flexibility to importers through multiple authorizations. This policy is a significant step towards achieving the government’s vision of making India a global manufacturing hub.
